The Australian sharemarket is trading lower, after increased prospects of a hike in US interest rates weighed on Wall Street.
Strong jobs growth data from the US Labor Department has raised expectations the Federal Reserve will soon lift interest rates.
The US economy added 295,000 jobs in February, pushing the unemployment rate down to 5.5 per cent, the lowest level since May 2008.
CMC Markets chief market analyst Ric Spooner said the US jobs news was the key driver behind the Australian market’s fall.
“The reason for that is that it has changed the market’s outlook on the timing of US rate increases,” he said.
Mr Spooner said much of the recent run-up in markets was based on very low interest rates and a will take off some of the froth.
Also, the good data had strengthened the US dollar. That was a negative for commodity prices, which are set in US dollar, and consequently weighed on the big miners.
With the Australian dollar falling in value against the greenback, the pressure is off the Reserve Bank of Australia to again cut interest rates here, he added.
In the resources sector at 1200 AEDT, global miner BHP Billiton was down 46 cents at $32.18, Rio Tinto had fallen 92 cents to $59.47, and Fortescue Metals had scraped off one cent to $2.14.
Oil and gas producer Woodside Petroleum lost 50 cents to $34.66.
Santos retreated 26 cents to $7.58 as it struck a deal to supply natural gas to Alcoa of Australia, the country’s biggest alumina producer.
Among the major banks, Commonwealth Bank descended 47 cents to $90.62, National Australia Bank weakened 25 cents to $37.72, ANZ surrendered 19 cents to $35.20, and Westpac shed 27 cents to $37.41.
Telstra was off 6.5 cents at cents lower at $6.215.
KEY FACTS
* At 1205 AEDT on Monday, the benchmark S&P/ASX200 index was down 59.5 points, or 1.01 per cent, at 5,839.4 points.
* The broader All Ordinaries index was down 58.4 points, or 1.0 per cent, at 5,810.2 points.
* The March share price index futures contract was 62 points lower at 5,828 points, with 9,606 contracts traded.
* National turnover was 670.9 million securities worth $1.43 billion.
