The Wrap: ASX breaks four-day winning streak amid confidence plunge

By Angus Dalton

Welcome to your five-minute recap of the trading day and how the experts saw it.

The numbers: The Australian sharemarket’s four-day run of gains ended on Wednesday with a 0.9 per cent fall.

The ASX 200 was down sharply early in the day, falling 1.4 per cent just past midday but clawed some territory back with the help of the energy and financials sectors, which closed in the green.

Real estate tanked by 3.5 per cent and tech lost 2.6 per cent.

The bigger-than-expected drop in consumer confidence helped send Wall Street stocks sharply lower.
The bigger-than-expected drop in consumer confidence helped send Wall Street stocks sharply lower.Credit:AP

The lifters: Liontown Resources 5.2%, Star Entertainment Group 3.3%, Aurizon 3.2%

The laggards: Imugene -14%, -9.6%, Silver Lake Resources 8.2%

The lowdown: Wall Street and the Australian sharemarket rose earlier this week as China relaxed lockdown restrictions and investor sentiment increased, but on Wednesday plunging consumer confidence figures in the US drove local markets down for the first time in four sessions.

The sharemarket’s decline followed broad losses on Wall Street, spooked by US consumer confidence hitting its lowest in about a year and a half.

Conversely, retail spending increased in Australia for the fifth consecutive month in May with a 0.9 per cent rise, double the forecasted increase. The Australian Bureau of Statistics reported resilient shoppers splashed $34.2 billion on retail, up 10 per cent on May 2021, although inflation drove prices higher and this as reflected in the increased retail spend.


“Higher prices added to the growth in retail turnover in May,” said the ABS’s Ben Dorber. “This was most evident in cafes, restaurants and takeaway food services and food retailing.”

The continued strong spending will likely encourage further rate rises from the Reserve Bank of Australia.

Liontown Resources led gains on the ASX 200 on Wednesday with a 5.2 per cent rise to $1.13 after announcing a five-year lithium supply deal with Ford.

Shares in The Star group were up 3.3 per cent to $2.80 following the announcement of Robbie Cooke as the new CEO of the stricken casino giant.

Imugene continued its correction from Monday’s rocketing price, dropping a further 14 per cent on Tuesday’s 10 per cent fall.

Tweet of the day:

Quote of the day: “Crypto is having its own 2008 GFC moment. Like the Lehman Brothers collapse, this is due to the age-old human story of greed, arrogance and disregard for the responsibility bestowed upon certain individuals … As in any investing space, individuals in the crypto space who made these bad decisions without proper risk management on behalf of managing their clients’ wealth, should be prosecuted to the full extent of the law.” Dr Eric Lim of UNSW Business School.

You may have missed: stocks plunged almost 10 per cent on their return from a trading halt following the online marketplace group’s $1.2 billion equity raising attempt to takeover US listings business Trader Interactive.

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