The Australian sharemarket has fallen in a broad-based sell-off led by technology stocks after the US Federal Reserve chairman Jerome Powell overnight failed to openly green-light further rate cuts.
The benchmark S&P/ASX 200 index had fallen 89.7 points, or 1 per cent, to 8756.2 as of 12.07pm AEST, with 10 out of the 11 sectors in the red, led by heavy losses in tech, healthcare, and retail.
In a speech overnight, Powell mostly reiterated a cautious view on monetary policy, saying “near-term risks to inflation are tilted to the upside and risks to employment to the downside – a challenging situation”.
Capital.com market analyst Kyle Rodda said that while Powell did not push back on more rate cuts, his “language was neutral in nature as he refused to be drawn on making a call about when the Fed would cut rates next”.
The Australian tech sector tracked a weaker lead from Wall Street, falling more than 1 per cent. WiseTech lost 2.5 per cent, Xero, Block and Life360 1.4 per cent, and Appen 1.5 per cent.
Pro Medicus fell 3 per cent to drag the health sector lower, while CSL fell 1.2 per cent, and Telix Pharmaceuticals pared gains from a rally earlier this week to come off 2.7 per cent.
Retail stocks dipped as fresh data showed the consumer price index in August ticked up 3 per cent year-on-year, rising from 2.8 per cent in July, with Myer down 3.8 per cent, Wesfarmers 1.4 per cent, JB Hi-Fi 1.1 per cent, and Eagers Automotive 1.2 per cent.
“Today’s modestly higher than expected August CPI result effectively kills off the last fleeting chance of an RBA interest rate cut next week,” said Betashares chief economist David Bassanese.
The financial sector also weighed, with Westpac down 2.5 per cent on news that 200 tellers would be axed, while ANZ came off 1.9 per cent, National Australia Bank 1.8 per cent, and Commonwealth Bank 0.9 per cent.
In commodities, gold held its record set on Tuesday and silver futures rose overnight to 14‑year highs of $US44 per ounce, while oil extended gains on mounting risks to Russian supply, including Ukrainian strikes on energy infrastructure and heightened tensions with NATO.
Stocks on the move
James Hardie fell 4.8 per cent after Citi said targets stated in materials for its upcoming annual general meeting released overnight appeared to differ “materially” from consensus expectations.
KMD Brands rallied 2.4 per cent despite the outdoor retailer posting a full-year statutory loss of $NZ93.6 million ($83.1 million), with earnings hit by heavy discounting and weaker margins.
Deterra Royalties rose 2.8 per cent after agreeing to sell its non-core gold offtake assets and its St Ives and Dandoko gold royalties to Vox Royalties for $US60m ($91 million).