Fed uncertainty offsets higher metals prices
Uncertainty about when the US Federal Reserve will start trimming its stimulus program offset a rise in metal prices and better than expected company earnings.
"The net result - pretty flat," said John Campbell, co-founder of Avoca Investment Management.
The benchmark S&P/ASX 200 Index finished five points lower at 5152.4, while the broader All Ordinaries dipped 4.2 points to 5136.7.
The biggest company to report on Thursday was Wesfarmers - owner of Coles and Bunnings - which had a $2.26 billion profit in 2012-13, up 6 per cent. That was weaker than expected, and its shares fell 67¢, or 1.6 per cent, to $41.26. Rival supermarket owner Woolworths fell 34¢ to $33.27.
The big miners kept the market from falling too far, thanks to a rise in copper and iron ore prices. But with BHP Billiton scheduled to report its earnings next week, Mr Campbell said investors were not getting ahead of themselves.
BHP advanced 1.2 per cent to $37.33, while rival Rio Tinto shed 0.9 per cent to $61.40 as it traded ex-dividend.
The health sector was the biggest loser, sliding 2.14 per cent. Blood products maker CSL weighed on the market, shedding 3.4 per cent to $63.58, continuing its decline for a second day after it forecast slower profit growth.
Financial services group AMP posted a smaller than expected fall in underlying profit. Its shares gained 16¢, or 3.5 per cent, to $4.70.
RBS Morgans senior client advisor Bill Bishop said the market was holding up well, rebounding from a low of 4632.3 points on June 25.
Frequently Asked Questions about this Article…
Uncertainty about when the US Federal Reserve will start trimming its stimulus offset gains from rising metal prices and better-than-expected company results, leaving the market essentially flat for a second day.
The S&P/ASX 200 finished five points lower at 5,152.4, while the broader All Ordinaries dipped 4.2 points to 5,136.7.
Wesfarmers reported a $2.26 billion profit for 2012–13, up 6% but weaker than expected. Its shares fell 67 cents, or about 1.6%, to $41.26.
Woolworths' shares fell 34 cents to $33.27 on the same session that saw Wesfarmers deliver softer-than-expected profit growth.
Yes — rising copper and iron ore prices helped prevent a larger fall. BHP Billiton advanced 1.2% to $37.33, while Rio Tinto slipped 0.9% to $61.40 as it traded ex-dividend.
The health sector slid 2.14%, led by CSL which shed 3.4% to $63.58 after forecasting slower profit growth, continuing a two-day decline.
AMP posted a smaller-than-expected fall in underlying profit, and its shares rose 16 cents, or 3.5%, to $4.70 as investors responded positively to the result.
Investors should watch US Federal Reserve signals about stimulus trimming and upcoming big company reports — notably BHP Billiton’s earnings next week — since commentators noted investors were cautious and not getting ahead of themselves despite recent commodity strength.
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