Australian stocks closed slightly weaker.
Here’s the scoreboard:
- S&P ASX 200: 5,348.00 -3.56 -0.07%
- All Ordinaries: 5,386.30 -1.83 -0.03%
- AUD/USD: 0.7256 +0.0030 +0.42%
Local trade started strongly after official interest rates in China were cut, with the one-year benchmark bank lending rate falling 25 basis points to 4.35%.
But stocks drifted to a weak close in the afternoon, with seven sectors lower and three higher, following Friday’s 1.67% rise on the ASX and Wall St’s 1.1% gain on the S&P 500.
Most of the banks were marginally stronger but mining stocks were mixed. BHP was down 0.8% to $24.57 and Rio Tinto was up 0.79% to $53.81.
AMP lost 1.68% to $5.85 after announcing it was raising $200 million through a notes offer to strengthen the group’s capital base.
The top stories Monday:
1. Earnings upgrade. Shares in BlueScope took off after it announced a deal with the NSW government which will save it $60 million in payroll taxes. This follows a negotiated pay freeze at its Port Kembla steel works. Its shares closed more than 10% higher at $4.475.
2. TV blues. The Ten network’s full year losses worsened by 85.5% to $312.24 million, most of it write downs in the value of its free-to-air television licence.
3. Getting smarter. High-frequency traders are earning between $110 million and $180 million a year in Australia, according to estimates by ASIC, the corporate watchdog.
4. Great margins. The gap between what Australian banks charge home owners for their loans and the Reserve Bank’s official cash rate is widening.
5. Dollar deals. The Australian dollar could soar if the RBA doesn’t cut rates next week, according to the NAB’s FX strategy team.
6. More monetary policy easing. China’s rate cut won’t be the last this year, according to analysts. And this is why it’s a good thing if China downgrades its economic growth target.