ASX200 sheds 0.52% amid commodity plunge; Energy & Materials fall

Highlights:

• ASX200 loses 0.52%, as commodity prices have likely pressurised materials and energy stocks.
• Mining stocks FMG and RIO closed lower, while banking stocks CBA and NAB ended on positive note on ASX today.
• Information technology and A-REITs alongside healthcare and consumer staples sector too registered upbeat movements on the ASX. 

Benchmark ASX200 dropped 34.80 points, shedding 0.52% to close at 6,594.50 on Wednesday. Commodity prices likely weighed on Australian stocks. Also, energy and materials sector lost 5.81% and 5.03% respectively. Even Utilities and Industrials were on the losing side. However, Information Technology, A-REITs and Healthcare stocks pushed the ASX200 index a tad higher. Financial sector too gained investors’ attention as banking stocks are on focus after RBA’s cash rate hike yesterday.

Bank stocks in news

The big four banks of Australia kept buzzing in news as they were expected to follow RBA’s trail to increase rates. CBA, ANZ and NAB are expected to lift their interest rates on deposit accounts and in their home loans.  CBA, ANZ, NAB and WBC shares closed Wednesday’s trade slightly higher.

Top Gainers and losers

Image Source ^© 2022 Kalkine Media ®, data source- ASX website

Market movers

• Weaker commodity prices were creating resistance for material stocks today. Material majors like Fortescue Metals (ASX:FMG) fell 4.85% and Rio Tinto (ASX:RIO) dropped 7.35%. Stocks were suffering due to a dip in iron ore prices.
• Heavy losses were also registered among gold miners as gold prices dropped further today. Newcrest Mining Limited (ASX:NCM) fell 6.62% and Evolution Mining Limited (ASX:EVN) shed 3.98%. Defying sectoral gravity, was Alkane Resources (ASX:ALK), which ended 1.49% higher. Alkane’s Tomingley operations have reportedly exceeded its FY22 production guidance.
• From financial sector, EML Payments (ASX:EML) gained 10.51% after it collaborated with Correos on the Spanish Government Stimulus program.
• In the healthcare sector, a substantial market prospect opened for ResApp Health Limited (ASX:RAP). The digital health company received US FDA’s clearance for its at-home sleep apnea test - SleepCheckRx. However, RAP shares ended 3.703% lower today.

In global markets:

Globally, investors are still worried about possibilities of a global recession on the back of a monetary tightening across economies. Another influencer is the looming energy and material demand supply gap in Europe due to the Russian invasion of Ukraine. In the US, investors are awaiting minutes from Fed’s June meeting. In Asia, stock markets were looming lower. Japan’s Nikkei was down alongside South Korea’s KOSPI. In China, mass testing began in Shanghai for Covid-19 after detecting new cases. These increased concerns of new lockdowns are likely taking the Chinese Shanghai Composite and Shenzen Component index down. Hong Kong’s Hang Seng also closed lower on Wednesday.

On commodities front:

• Oil was racing further up as investors were worried about the supply tightness more than recession. Benchmarks Brent and WTI were gaining. Investors now await the US crude supply data to be released by the American Petroleum Institute.
• Gold was extending losses on Wednesday, while dollar flattened a bit after reaching a 20-year high. In other precious metals, silver, platinum, and palladium were trailing south.
• In the crypto sector, fears of insolvencies and aggressive moves by central banks are affecting investors’ decisions.