Australian shares recede after morning high tide
A surge in European shares and US markets returning to all-time highs pushed Australian stocks sharply higher this morning. However, the Australia 200 index failed just below the important 5750 level, sparking a slide and increasing the likelihood of further selling this afternoon.
Post budget support for retail stocks in particular and consumer related stocks in general is evident again today. Premier Investments and Harvey Norman are helping push the consumer discretionary sector to the top of today’s table. Materials stocks are also higher following rallies in metals markets overnight. After a belting yesterday, Resmed shares are up 5% this morning, helping to lift the healthcare sector to a 1% gain.
NAB shares trade are trading without their interim dividend this morning, dropping 3% and putting the financials (ex-property) into the red. Three of the big four banks are ex-dividend in the last two weeks, reducing their attractiveness to dividend yield seekers. Selling pressure is concentrated in the top stocks, illustrated by the underperformance of the twenty and fifty leaders’ indices versus broader market measures.
For further comment from Michael McCarthy at CMC Markets please call 02 8221 2135.