AU Morning Wrap: ASX Drops 1% as BHP Falls; APM Sinks 35%

Moomoo News AU wrote a column · Jan 17 17:46

G'day, mooers! Check out the latest news on today's stock market!
• S&P 500 lower as rate cut bets ease, gold prices sink
• ASX drops 1% as BHP falls
• Stocks to watch: Ampol, APM Human Services, Liontown Resources
- Moomoo News AU

AU Morning Wrap: ASX Drops 1% as BHP Falls; APM Sinks 35%

Wall Street Summary

U.S. stock indexes fell deeper into negative territory for 2024 as investors dialed back their expectations for how quickly the Federal Reserve might start cutting interest rates.

Retail sales rose a seasonally adjusted 0.6 per cent in December from a month earlier, according to data released on Wednesday, a larger increase than economists expected. The sign of economic strength could lessen the chance that central bank officials will cut interest rates as much as markets had previously expected, some investors said.

The $S&P 500 Index(.SPX.US)$ fell 0.6 per cent while the $Dow Jones Industrial Average(.DJI.US)$ slipped 0.3 per cent, or about 94 points. The tech-heavy $Nasdaq Composite Index(.IXIC.US)$ declined 0.6%. The S&P 500 is down 0.6 per cent in 2024, while the Dow and Nasdaq are off 1.1 per cent and 1 per cent, respectively.

AU Market Watch

Australian shares fell at the open after UK inflation data and US retail sales numbers bolstered the case of policymakers that markets are too optimistic on interest rate cuts.

The benchmark $S&P/ASX 200(.XJO.AU)$ dropped 1 per cent, or by 70.50 points to 7322.6 at the start of trade, led by sharp losses in materials and real estate stocks. All the 11 sectors were in the red. The Australian dollar fell to US65.5¢, putting a potential US64¢ on the radar screen.

In commodities, iron ore dropped, oil slid and gold was poised to fall back below $US2000 an ounce.

Iron ore miners tracked the lower steel making commodity price. ASX heavyweight BHP declined 0.9 per cent even as the mining giant said its WA iron ore production was up 5 per cent quarter-on-quarter.

The mining giant also warned that its nickel division would not be immune to falling nickel prices.

Stocks to Watch

$BHP Group Ltd(BHP.AU)$: BHP says WA iron ore production was up 5 per cent quarter-on-quarter, according to its latest update.

The mining giant said NSW Energy Coal had its best first half in five years, while BHP Mitsubishi Alliance (BMA) in Central Queensland had a "tough" six months following significant planned maintenance and low starting inventories. Production guidance for BMA has also been lowered to a range between 23 and 25 Mt.

$Ampol Ltd(ALD.AU)$: Ampol shares fell 1.9 per cent even as it said its full-year unaudited replacement cost operating profit (RCOP) will be slightly ahead of its record in 2022.

According to the fuel refinery and retailer, its growth in earnings from non-refining divisions "offset a reduction in refinery earnings from the historically high levels in the prior year".

$APM Human Services International Pty(APM.AU)$: APM Human Services tumbled 35.1 per cent after it issued an aftermarket profit warning for the first half. The human services group forecast preliminary and unaudited revenue for the first half of $1.14 billion, underlying earnings before interest and amortisation of $148 million, and underlying net profit of $55 million.

$Liontown Resources Ltd(LTR.AU)$: Liontown Resources plunged over 10 per cent following NYSE-listed lithium giant Albemarle has sold its 4 per cent stake in the lithium play after market close on Wednesday, Street Talk reported, three months after its $6.6 billion takeover bid for the company was kiboshed by Gina Rinehart.