The local share market is moving lower after an overnight rate hike by the US Federal Reserve, but has managed to claw back some of its morning losses.
At noon AEST on Thursday, the benchmark S&P/ASX200 index was down 21.7 points, or 0.3 per cent, to 7,175. It had been down by as much as 0.8 per cent in early trading.
The broader All Ordinaries was down 19.2 points, or 0.26 per cent, to 7,369.
Rates in the US increased by 25 base points to 5.25 per cent in what the Federal Reserve hinted could be its final rate hike.
"That's a meaningful change, that we're no longer saying 'we anticipate' (more rate hikes)," chair Jerome Powell said.
GSFM investment strategist Stephen Miller said the rate-hike pause may be motivated by enduring difficulties in the regional bank sector.
"What might upset the Fed's plan is that regional bank woes occasion a severe tightening of credit conditions so that any consequent activity growth correction comes to resemble a more severe and enduring recession," he said in a statement.
The ASX's financial sector was deep in the red at noon, down by 2.35 per cent with all big banks experiencing drops.
NAB plunged by 6.5 per cent to $26.77 despite announcements its cash profits had improved by 17 per cent to $4.07 billion, slightly below analyst estimates.
Meanwhile, CBA was down 1.9 per cent to $96.38, Westpac 3.3 per cent to $21.43 and ANZ 2.43 per cent to $23.44.
Out of the ASX's 11 sectors, the heavyweight mining sector performed best at noon and was up by 1.11 per cent, alongside Energy by 0.4 per cent and Industrials by 0.5 per cent in the green.
BHP jumped by 1.33 per cent to $43.84, Rio Tinto by 1.6 per cent to $110.51, and Fortescue by 1.15 per cent to $20.22.
Left in the red was Mineral Resources, down by a dramatic 4.3 per cent to $68.84.
Woodside Energy was up by 0.1 per cent to $32.66 with Santos up by 0.7 per cent to $7.02, while coal miners Whitehaven Coal and Yancoal were down 2.5 per cent to $7.01 and 1.6 per cent to $5.46, respectively.
Super Retail Group was down 6.2 per cent to $12.62 after the Supercheap Auto, Rebel Sports, BCF and Macpac owner told the Macquarie conference that its gross profit margins had slipped in the second half.
"Offshore freight costs have returned to pre-pandemic levels, however inflationary pressures on wages, rent and energy expenses will impact group (cost of doing business) in the second half," CEO Anthony Heraghty said.
The Australian dollar was buying 66.73 US cents, from 66.67 US cents at Wednesday's ASX close.
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May 04, 2023 at 09:23AM
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Bank shares stay low with Federal Reserve hike - Yahoo Finance Australia
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