ASX 200 drops over 1%; energy stocks buck trend

June 29, 2022 11:55 AM AEST | By Priyanka Payal

ASX 200 drops over 1%; energy stocks buck trend — Image source: © Lordignolo | Megapixl.com

Highlights:

The ASX 200 index opened sharply lower on Wednesday, putting an end to its’ 4-day rebound

Ten of 11 sectors traded lower today, where the energy sector was the only one to trade in the green

The ASX 200 closed 0.86% higher at 6,763.60 points on Tuesday

Australian equities opened lower today (29 June), putting an end to their four-day rebound, as renewed concerns about recession and corporate earnings dragged Wall Street indices lower. The benchmark index ASX 200 was down 1.04% at 6,693.40 points in the starting few minutes of trade. The ASX All Ords index was 0.91% lower at 6,890.4 points. On Tuesday, the ASX 200 closed 0.86% higher at 6,763.60 points.

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US stocks performed miserably yesterday as investors parsed data which showed that consumer confidence cooled in June again, reigniting recession fears. Data released by the Conference Board revealed that consumers’ short term outlook declined drastically to its lowest in almost 10 years.

With this month coming to an end which is also coinciding with the quarter close this week, it is also likely that portfolio rebalancing will have an impact on the market action. Meanwhile, investors are also assessing what impact China’s relaxation of COVID-19 restrictions will have on the world’s economic growth.

All the three major US indices closed with sharp losses Tuesday (28 June). The S&P 500 declined 2.01% to close at 3,821.55 points. The tech-heavy Nasdaq fell 2.98% to 11,181.54 points, while the Dow Jones Industrial Average settled 1.56% lower at 30,946.99 points.

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Newsmakers:

Liontown Resources Limited (ASX:LTR):

Liontown Resources Limited grabbed investors’ attention today after the company announced that it has executed a binding offtake agreement & funding facility with global automaker giant Ford Motor Company. As per the company, the said agreement with Ford is about supply of nearly 150,000 DMT per annum of spodumene concentrate. The spodumene concentrate will arrive from Liontown’s 100%-owned Kathleen Valley Lithium Project in Western Australia for five years. Meanwhile, in a separate announcement, the company has also announced the full development of its Kathleen Valley Lithium Project in WA.

Pilbara Minerals Limited (ASX:PLS):

The shares of Pilbara Minerals Limited were in the limelight today after the company provided an update on June quarter production and shipment activities at its wholly-owned Pilgangoora Project in WA. The lithium company has increased its estimated June quarterly production of spodumene concentrate by approximately 54% to 123-127,000 dry metric tonnes (dmt).

Market Action:

Coming to the top ASX 200 gainers, Liontown Resources Limited (ASX:LTR), Pilbara Minerals Limited (ASX:PLS) and Beach Energy Limited (ASX:BPT) led the pack with 11.737%, 3.765%, and 3.682% gains, respectively. On the other side, Carsales.com Limited (ASX:CAR), and National Storage REIT (ASX:NSR) were the biggest losers, falling 12.910% and 6.035%, respectively.

On the sectoral front, at the time of writing, ten of 11 sectors traded lower today, where energy sector was the only sector to trade in the green. The S&P/ASX 200 Energy [XEJ] was up nearly 1.762% at 10447.000 points. The rise in oil prices has pushed up the energy sector today. The top three sectors leading the losses included A-REIT, Telecommunications services and information technology, down by 2.78%, 2.03%, and 1.86%, respectively.

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