ASX losing streak worst in 18 months

The ASX was in the green until NSW’s lockdown was extended, but the damage from a 15 per cent iron ore price plunge could have been worse.

The Australian sharemarket extended its losing streak to five straight days, the first time it has done so in 18 months, weighed down by NSW’s coronavirus crisis.

The S&P/ASX200 closed just 3.7 points lower at 7460.9, while the All Ordinaries Index dipped 10.2 points to 7725.1.

“The last time the ASX200 fell for five consecutive sessions or more was in February 2020,” CommSec analyst James Tao said.

“The benchmark index fell 2.2 per cent for the week, making it the worst weekly performance since the end of January this year.”

Mr Tao said the index lifted as much as 48 points or 0.64 per cent at its intraday high but dipped following the daily NSW Covid-19 update when 644 new cases were announced along with an extension of the Greater Sydney lockdown until the end of September.

OMG chief executive Ivan Tchourilov said it was a choppy session to cap off a tough week.

“While some stellar (earnings) results are continuing to be announced and the long-term outlook is generally favourable, several immediate macroeconomic impacts are weighing the market down,” Mr Tchourilov said.

“The iron ore price, which supercharged the market for most of the year, is now plummeting back down to earth.

“The continued impact of the Covid Delta variant is now pricing itself into the market as well.”

The iron ore price fell an eye-watering 15 per cent overnight. It had plunged about 40 per cent in the past three months since peaking in May, HSBC Global Research said, while oil prices fell to a three-month low and copper prices to a four-month low, with the broad-based nature of the decline signalling macroeconomic growth concerns.

BHP dropped 0.74 per cent to $44.34 following two straight days of steep declines in the wake of its plan to offload its petroleum division to Woodside and amid concerns its sharemarket listing unification plan would benefit British investors over Australian investors.

The mining giant tumbled 16 per cent this week.

Rio Tinto firmed six cents to $107.23 but ended the week almost 11 per cent weaker, while Fortescue lifted 1.14 per cent to $20.36 but lost almost 9 per cent over the week.

Mr Tchourilov said there was opportunity amid volatility and BHP was the second most purchased stock at his company this week, behind Commonwealth Bank, which also lost ground in recent sessions.

CBA rose five cents to $99.27, ANZ gave up five cents to $28.31, National Australia Bank backtracked 0.36 per cent to $27.41 and Westpac shed six cents to $25.76.

Sydney Airport booked a near $100m half-year net loss after passenger numbers plunged 36.4 per cent compared to the prior corresponding period.

Chief executive Geoff Culbert said it had been a challenging six months but traveller traffic rebounded strongly every time borders reopened.

The company is pinning its hopes on a vaccine rollout and Mr Culbert says it will be “ready to go” when border restrictions ease.

Shares in Sydney Airport, which recently rejected a takeover bid from a consortium, dropped 0.26 per cent to $7.70.

Shopping centre giant Stockland reported a massive turnaround, delivering a full-year statutory profit of $1.1bn, compared to a $21m loss previously, saying there had been solid improvement in retail leasing activity, rent spreads and cash collection rates, while residential property sales momentum continued.

Shares in the company slipped 0.66 per cent to $4.52.

Hearing products giant Cochlear sank 7.44 per cent to $237.05 despite booking a full-year statutory net profit of $326.5m, a big turnaround from a $238.3 loss previously.

Sales revenue hit a record $1.49bn, driven by a combination of market share gains, market growth and rescheduled surgeries after Covid-19 shutdowns.

Cochlear declared a final dividend of $1.40 per share, bringing the full-year payout to $2.55 per share, up 59 per cent.

Telco TPG, which merged with Vodafone a year ago, announced it was considering selling its telecommunications tower assets in the wake of Telstra doing the same.

TPG also reported a $76m half-year net profit, down $7m, and declared an interim dividend of 8 cents per share.

Its shares retreated 0.45 per cent to $6.58.

Bedlinen retailer Adairs booked a near 81 per cent surge in statutory full-year net profit to $63.7m, driven by the well-observed trend of home sprucing.

The retailer also reported it had cleared its debt and declared a final dividend of 10 cents per share, taking the annual payout to shareholders to 23 cents per share.

Adairs shares appreciated 1.9 per cent to $3.76.

Poultry producer Inghams gained 4.6 per cent to $4.09 after posting a 107 per cent jump in full-year statutory net profit to $83.3m, crediting operational measures and “resilient” demand for chicken and turkey.

The Aussie dollar was fetching 71.14 US cents, 52.24 British pence and 60.89 Euro cents in afternoon trade.

Originally published as Australian sharemarket’s losing streak extended to five straight days, weighed down by NSW virus crisis

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