AUS
NZ
UK
CA
USA
IND
Highlights
- Australian equity markets extended Tuesday’s losses amid worries over aggressive rate hikes
- Investors remain cautious as the US Federal Reserve is likely to announce a rate hike of a 75-basis point early morning tomorrow
- On Tuesday, the benchmark index closed 3.55% lower at 6,686 points
Australian equities opened lower on Wednesday (15 June), extending yesterday’s brutal selloff as market participants are now speculating an aggressive rate tightening path in Australia. The benchmark ASX 200 index was down 0.39% at 6,659.60 points in the initial minutes of trading today. The ASX All Ordinaries index was 0.45% lower at 6,850.4 points. The Federal Reserve is expected to raise interest rates by 75 basis points following Friday’s unfavourable US inflation data for May. There are speculations that the US central bank may go to any extend to bring inflation, which is at a fresh 40-year high, under control.
First, the US inflation data and then the consequent fears over aggressive interest rate hikes that could take the world’s biggest economy into recession, have dented investors' sentiments in the last couple of days. Almost all the sectors are bearing the brunt of the current market volatility and are witnessing selloff.
After the selloff, which had pushed the S&P 500 into a bear market on Monday, the broad market index continued its slide on Tuesday and was down almost 0.38% at 3735.48 points. The tech-heavy Nasdaq Composite, however, witnessed some pullback to end 0.18% higher at 10,828.35 points, while the Dow Jones Industrial Average fell 0.50% to 30,364.83.
Newsmakers:
Rio Tinto (ASX: RIO)
The shares of ASX-listed leading iron ore mining company Rio Tinto are on investors' radar today on the back of an important announcement by the company. The company today informed that it has delivered the first ore from the Gudai-Darri iron ore mine as it brings online its first greenfield mine in the Pilbara, WA, in over a decade. Gudai-Darri is understood to help underpin the future production of Rio Tinto's flagship Pilbara Blend™ product. As per the announcement, the mine's commissioning and ramp-up is anticipated to increase Rio Tinto's iron ore production volumes and improve the product mix from the Pilbara in the second half of this year.
Ampol Limited (ASX: ALD)
Shares of ASX-listed petroleum company grabbed investors' attention on Wednesday (15 June) after the company commenced a fully underwritten wholesale offering of AU$150 million of subordinated notes due in 2082 (Subordinated Notes).
As per the company's announcement, the proposed Subordinated Notes issue forms part of Ampol's ongoing capital management strategy and follows the successful issue of AU$500 million of subordinated notes in December 2021.
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Market Action:
Coming to the top ASX 200 gainers, Janus Henderson Group Plc (ASX:JHG), Imugene Limited (ASX:IMU), and Incitec Pivot Limited (ASX:IPL) led the pack with 3.728%, 3.571%, and 3.372% gains, respectively. On the flip side, Megaport Limited (ASX:MP1), and James Hardie Industries Plc (ASX:JHX) were the top losers, falling 5.793% and 3.881%, respectively.
On the sectoral front, seven of 11 sectors were trading lower at the time of writing. Consumer Discretionary was the best performing sector, while other sectors in the green included consumer staples, A-REIT, and Energy. Meanwhile, the losses on the broader index were led by the materials sector, followed by Utilities, Industrials, Information technology, Financials and others.
Noticeably, gold prices lost their gleam as the US dollar hit a 20-year high on Tuesday. Iron ore prices fell on Tuesday after fresh covid-19 outbreaks in China clouded demand prospects in the world's second-largest economy.
Meanwhile, the shares of three ASX-listed banking giants Commonwealth Bank of Australia (ASX:CBA), Westpac Banking Corporation (ASX:WBC), Australia and New Zealand Banking Group Limited (ASX:ANZ), recovered from opening losses.
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