australian stocks close in the red for the sixth consecutive session 1546242015

Australian stocks continued their sell-off for the sixth consecutive trading session Tuesday, following negative cues from Wall Street’s overnight close, and a mixed bag of economic reports.

Though the S&P/ASX 200 hit the day’s best level of 5,523.90 in volatile trading during the first two hours, those gains rapidly dissipated as the day progressed. In a bearish signal, the index closed a hair above the day’s low of 5,468.50.

Indices and sectors

The benchmark S&P/ASX 200 fell 27.2 points, or 0.5 per cent, and closed at 5,471.3, while the broader All Ordinaries index was down 26.8 points, or 0.5 per cent, at 5,479.7.

The only sectors that closed with gains were energy (+0.14 per cent) and telecommunication services (+0.07 per cent). The losing sectors included consumer discretionary (-1.43 per cent), materials (-1.01 per cent), consumer staples (-0.99 per cent), healthcare (-0.67 per cent) and information technology (-0.63 per cent).

Stocks

Stocks within the mining sector showed a divergent trend. Though BHP Billiton Limited (ASX:BHP) fell 1.08 per cent to AU$27.60 and Rio Tinto Limited (ASX:RIO) declined 1.14 per cent to 56.37, Fortescue Metals Group Limited (ASX:FMG) surged 3.02 per cent to AU$2.39. This is despite iron ore prices trading at a four-month high.

Energy stocks were amongst the few that were bullish yesterday. Woodside Petroleum Limited (ASX:WPL) gained 0.94 per cent to AU$35.60, Oil Search Limited (ASX:OSH) was up 0.28 per cent to AU$7.22 and Santos Ltd (ASX:STO) gained 1.14 per cent to AU$8.00. However, Origin Energy Ltd (ASX:ORG) headed the other way, falling 0.48 per cent to AU$12.56.

With the exception of Westpac Banking Corp (ASX:WBC), which gained 0.5 per cent to AU$31.35, the other three big banks closed with losses. Commonwealth Bank of Australia (ASX:CBA) was down 0.59 per cent to AU$79.82, Australia and New Zealand Banking Group (ASX:ANZ) dipped 0.03 per cent to AU$31.16 and National Australia Bank Ltd. (ASX:NAB) fell 0.78 per cent to AU$31.60.

Retailers ended mostly in the red. Wesfarmers Ltd (ASX:WES), the owner of supermarket chain Coles, slumped 1.29 per cent to AU$41.28, Woolworths Limited (ASX:WOW) fell 0.51 per cent to AU$27.11, Caltex Australia Limited (ASX:CTX) was down 0.72 per cent to AU$31.77 and Myer Holdings Ltd (ASX:MYR) declined 2.52 per cent to AU$1.36.

Economic news, currency and market outlook

National Australia Bank Ltd. (ASX:NAB) monthly business survey showed that business confidence, boosted by the recent federal budget, rose in May to its highest level in nine months, according to the ABC. Business confidence rose from +3 to +7, while business conditions jumped from +4 to +7. "Confidence was significantly higher in retail/wholesale (possibly associated with expectations from the small business package) and finance, business and property services," the report said.

Data on home loans released by the Australian Bureau of Statistics showed that during April, investor lending grew 2.6 per cent, after having shot up 7.1 per cent during the previous month, and indicating that governmental measures to curb lending to property investors may not have worked, according to ABC. "Nothing from these numbers indicates that macro-prudential measures were impacting," said Westpac senior economist Matthew Hassan. "If anything it seems to be the other way around, that the February rate cut seems to have given a little bit of a lift to activity across both investor and owner-occupier segments."

The monthly ANZ survey of job advertisements showed that total job ads were unchanged in May after a 2.5 per cent, seasonally adjusted rise in April, according to Business Spectator.

On Wall Street overnight, the Dow Jones Industrial Average fell 2.51 points, or 0.01 percent, to 17,764.04, the S&P 500 gained 0.87 points, or 0.04 percent, to 2,080.15 and the Nasdaq Composite dropped 7.76 points, or 0.15 percent, to 5,013.87.

The Australian dollar is currently trading somewhat higher but has been limited by ANZ’s job ads data, according to the Business Spectator. At 07:00 this morning (AEST), the Aussie was trading at 76.91 US cents, up from 76.73 US cents on Tuesday.

The Australian stock market is likely to open flat today given that at 06:45 this morning (AEST) the June ASX SPI200 Index (AP) Futures was up just 3 points at 5,465.