The share market fell as early momentum provided by a higher Australian dollar and commodity prices was overshadowed by negative responses to US President-elect Donald Trump’s first press conference in six months.
Shares rose in morning trade, particularly in the mining sector, after a fall in the US dollar overnight, which helped commodity prices, CMC Markets chief market strategist Michael McCarthy said.
The US dollar’s fall was linked to Mr Trump’s media appearance, in which he failed to provide details on his plans to stimulate the US economy, and spoke about increasing trade barriers.
The Australian dollar is trading around its highest level in nearly a month, and was at 74.69 US cents at 1700 AEDT, up from 73.79 US cents on Wednesday.
But the local share market ran out of steam, ending the session about 0.1 per cent weaker.
“As the president-elect’s speech wore on it became clear there was going to be no detail around the much-touted stimulus programs, and markets showed some disappointment,” Mr McCarthy said.
“The evidence of that is in the performance across the Australian market today.”
Some stocks in the pharmaceuticals and biotechnology sector with large exposure to the US market were affected by Mr Trump’s accusation that drug makers were “getting away with murder” with what they charge the government. He also vowed to make changes.
Vaccines and blood products supplier CSL dropped $2.91, or 2.8 per cent, to $100.96, and cancer drugs supplier Mayne Pharma shed 5.5 cents, or 4.1 per cent, to $1.275.
“Healthcare was the worst performing sector on the US market at the close. It appears local investors have take similarly dim view of potential changes to healthcare in the US,” Mr McCarthy said.
BHP Billiton gained 34 cents to $26.36, Rio Tinto added 59 cents to $62.87 and Fortescue Metals was seven cents higher at $6.30.
The big four banks gave up much of their early gains, with Westpac down three cents at $33.43, ANZ adding four cents to $31.24, Commonwealth Bank up three cents at $85.03 and National Australia Bank 11 cents higher at $31.52.
Troubled baby foods supplier Bellamy’s Australia continued to slide, falling 95 cents, or 17.8 per cent, to $4.40 as some analysts downgraded the stock after the company replaced chief executive Laura McBain and warned of lower annual earnings.
ON THE ASX:
* The benchmark S&P/ASX200 dropped 4.6 points, or 0.08 per cent, to 5,766.9 points.
* The broader All Ordinaries index dropped 2.1 points, or 0.04 per cent, to 5,821.6 points.
* The March SPI200 futures contract was down one point at 5,728 points, with 26,412 contracts traded.
* National turnover was 2.9 billion securities traded worth $5.2 billion.
CURRENCY SNAPSHOT at 1700 AEDT:
One Australian dollar buys:
* 74.69 US cents, from 73.79 US cents on Wednesday
* 85.46 Japanese yen, from 85.57 yen
* 70.40 euro cents, from 69.95 euro cents
* 61.15 British pence, from 60.69 pence
* 105.48 New Zealand cents, from 105.46 NZ cents
GOLD:
The spot price of gold in Sydney at 1700 AEDT was $US1,198.50 per fine ounce, up $US9.47 from $US1,189.03 on Wednesday.
BOND SNAPSHOT at 1630 AEDT:
* CGS 5.25 per cent March 2019, 1.821pct, down from 1.861pct on Wednesday.
* CGS 4.25pct April 2026, 2.608pct, down from 2.669pct.
Sydney Futures Exchange prices:
* March 2017 10-year bond futures contract at 97.3 (implying a yield of 2.7pct), up from 97.23 (2.77pct) on Wednesday.
* March 2017 3-year bond futures contract at 98.04 (1.96pct), up from 98.0 (2.0pct).
(*Currency closes taken at 1700 AEDT previous local session, bond market closes taken at 1630 AEDT previous local session)
SOURCE: IRESS
