Almost every sector dragged the ASX firmly into the red, with tech a major weight, eclipsing the Nasdaq’s big tumble overnight.
The Australian sharemarket sank firmly into the red following a Wall Street tumble, with the local tech sector by far the worst performer after the Nasdaq index snapped a three-session winning streak with a 2.5 per cent slump.
The benchmark S&P/ASX200 index closed 1.08 per cent lower at 7393.9, while the All Ordinaries Index dropped 1.03 per cent to 7717.1.
OMG chief executive Ivan Tchourilov said strong gains from earlier in the week had been “brought into line”, with sectors in the red across the board in a lacklustre trading day mirroring the US market overnight.
American investors digested producer price data confirming inflation was still rising in the supply chain and hawkish comments from Federal Reserve officials as to how the US central bank planned to contain those growing price pressures, Ord Minnett said.
There was plenty of action on the local bourse, Mr Tchourilov said.
“BrainChip continues its strong performance in 2022, up 7.14 per cent to $1.50 in today’s session,” he said.
“The company announced it had submitted a call capital notice to LDA Capital to subscribe for 15,000,000 shares worth approximately $50m.
“Accordingly, gains were up over 25 per cent just after midday until profit-taking kicked in, which led to some selling pressure in the afternoon.
“The stock has more than doubled in the new year and is receiving a lot of buzz around the market.”
Afterpay plunged 9.16 per cent to $69.03 after its US acquirer Block dropped 5.9 overnight.
Fellow buy-now-pay-later provider Zip lost 5.13 per cent to $3.70, while accounting software company Xero retreated 5.05 per cent to $119.11.
Overall, the tech sector was down almost 4 per cent.
Star Entertainment Group revealed its money laundering investigation by financial crimes regulator AUSTRAC had been expanded to include other entities within the group.
“AUSTRAC has advised that it has not made a decision regarding the appropriate regulatory response that it may apply to The Star, including whether or not enforcement action will be taken,” the casino operator said.
Star shares slid 1.94 per cent to $3.54, while rival Crown dipped 0.47 per cent to $12.59 – a day after US private equity giant Blackstone upped its takeover offer to $13.10 per share, valuing the embattled gambling company at almost $8.9bn.
Crown announced on Friday the appointment of Redbubble chair Anne Ward as a director had become effective following the receipt of all regulatory approvals.
Ord Minnett maintained its “buy” recommendation and target price of $15 for Crown.
“Concerns over the willingness of Crown to engage with Blackstone (and potentially other bidders) have now been allayed, as have fears the due diligence granted to Blackstone would reveal any negative surprises,” it said.
Given the value of Crown’s real estate and potential for its best use – such as the sale of the Barangaroo hotel as apartments – there remained plenty of value to unlock for the bidder that would allow them to raise their price to a best-and-final offer, Ord Minnett said.
Plus-sized women’s clothing retailer City Chic rocketed 11.63 per cent to $4.99 after reporting a near 50 per cent surge in first half sales growth and a higher spend on inventory to build up stock for the northern hemisphere summer season and key sales periods amid supply chain pressures.
Jewellery retailer Michael Hill also provided a positive trading update, including a near 10 per cent rise in shop sales during the December quarter, despite 2381 lost store trading days, and a 28 per cent rise in digital sales.
Shares in the company gained 1.05 per cent to $1.44.
Magellan Financial Group continued to slide south, falling 3.68 per cent to $19.65.
“The company has been in the news regularly with a resounding lack of confidence from investors due to a variety of issues that have plagued the investment management firm,” Mr Tchourilov said.
Fellow financial stock Pendal Group erased 15.83 per cent to $5, making it the worst performer on the ASX200, after reporting $6.8bn in net fund outflows for the December quarter.
“It has undoubtedly been a disappointing quarter,” chief executive Nick Good said.
ANZ inched one cent lower to $28.39, Commonwealth Bank fell 1.24 per cent to $100.85, National Australia Bank declined 0.64 per cent to $29.38 and Westpac shed 1.29 per cent to $21.45.
In the mining sector, Rio Tinto weakened 0.99 per cent to $110.60 and BHP fell 0.36 per cent to $46.68, while Fortescue inched three cents lower to $21.37 and Alumina added 2.5 per cent to $2.05.
Core Lithium was a standout, leaping 11.8 per cent to 90 cents, while Whitehaven Coal backtracked 5.09 per cent to $2.80.
The Aussie dollar was buying 72.83 US cents, 53.03 British pence and 63.44 Euro cents in afternoon trade.
Originally published as Australian sharemarket tumbles as tech stocks follow Nasdaq slump, finishes week 0.8pct lower
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