ASX’s winning run comes to an end: Wednesday 14 October

Steven Deare
(Australian Associated Press)

 

Australia’s share market has fallen short of an eighth consecutive positive session but an expert says the result is a good one given a poor US lead and coronavirus worries in Europe.

The S&P/ASX200 benchmark finished down by 16.5 points, or 0.27 per cent, to 6179.2 on Wednesday.

The index finished below the 6200 level, which it breached on Tuesday for the first time since March.

The All Ordinaries index was down 12.8 points, or 0.2 per cent, to 6387.4.

US markets finished lower after Johnson & Johnson paused a COVID-19 vaccine study when a participant fell ill.

Investsmart market strategist Evan Lucas said the ASX result was a good one given the US lead and more coronavirus restrictions being imposed in Europe.

The World Health Organisation said more than 700,000 new COVID-19 cases were reported in Europe last week, a jump of 34 per cent from the previous week.

Mr Lucas saw more reason for optimism locally following “astounding” consumer confidence figures.

The Westpac-Melbourne Institute consumer sentiment index jumped 11.9 per cent to 105 points, its highest level since July 2018.

Mr Lucas said it was an incredibly robust performance given the virus and economic impact.

“That this is one of the best times to be buying a house is an amazing thing to be talking about,” he said.

Experts credited the result to the federal budget, low virus infections and hopes of a rate cut.

On the ASX, healthcare was the best performer, 1.28 per cent higher.

CSL narrowed guidance on net profit and said it expected growth of three to eight per cent.

Chief executive Paul Perreault told an annual general meeting the previous low end of the range had been revised from zero to three per cent. This would give net profit after tax of $2.170 billion to $2.265 billion.

Shares rose by 1.36 per cent to $302.29.

The tech sector was next best, up 1.1 per cent.

It improved after financial crimes watchdog AUSTRAC decided it would take no more action against Afterpay.

An auditor decided the company met anti-money laundering requirements.

Afterpay reached a record price of $98.68, then finished 1.73 per cent higher to $96.09.

Bank of Queensland posted a fall in full-year profit, due to the virus, but believed better days were ahead.

Net profit was $115 million for fiscal 2020, down 61 per cent.

The annual dividend was slashed to 12 cents per share, down from 65 cents previously.

Shares were higher by 5.16 per cent to $6.73.

Westpac will consolidate international operations to London, New York and Singapore, and leave Beijing, Shanghai, Hong Kong, Jakarta and Mumbai.

The decision would not have a significant impact on earnings, the bank said.

The big four banks all lost more than 1.0 per cent.

In mining, BHP dropped 0.77 per cent to $36.03, Rio Tinto lost 1.26 per cent to $95.33 and Fortescue dropped 1.38 per cent to $16.39.

Building materials supplier James Hardie Industries raised its full-year profit forecast and said it expected record second-quarter results from solid demand. Shares were better by 1.59 per cent to $35.78.

Earlier in the US, all three major stock indices closed lower.

The virus study setback coincided with US House Speaker Nancy Pelosi rejecting a $US1.8 trillion ($A2.5 trillion) coronavirus relief proposal from the White House.

On Thursday, employment data for September will be of main interest and indicate how the national economy is faring in the coronavirus recession.

The Aussie dollar was buying 71.67 US cents at 1720 AEDT, lower from 71.88 US cents at the close of trade on Tuesday.

ON THE ASX

* The S&P/ASX200 benchmark finished down by 16.5 points, or 0.27 per cent, to 6179.2 on Wednesday.

* The All Ordinaries index ended lower by 12.8 points, or 0.2 per cent, to 6387.4.

* At 1720 AEDT, the SPI200 futures index was higher by 4.0 points, or 0.06 per cent, at 6165.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 71.67 US cents, from 71.87 US cents on Tuesday

* 75.58 Japanese yen, from 75.71 yen

* 61.02 Euro cents, from 60.92 cents

* 55.51 British pence, from 55.05 pence

* 107.69 NZ cents, from 108.03 cents.

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