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Australia Market falls to 8-months low

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Capital Market
Last Updated : Jan 24 2022 | 9:04 PM IST
The Australian share market finished session lower on Monday, 24 January 2022, as sentiment was dampened by tracking Friday's losses on Wall Street, weaker than expected Markit Economics Australia Manufacturing PMI data for January, U.S.-Russia tensions over Ukraine, and fears about the Fed tightening monetary policy more aggressively in 2022.

Market participants were awaited the outcome of the U.S. Federal Reserve's two-day Federal Open Market Committee meeting through Wednesday. Investors remained wary over a further hawkish move by the Fed as they gauge the timing of potential monetary policy changes. Market participants expect a 25 basis-point rate hike at the Fed policy meeting in March and three more by the year-end.

At closing bell, the benchmark S&P/ASX200 fell 36.27 points, or 0.51%, to 7,139.55, its lowest close since 27 May 2021. The broader All Ordinaries index sank 48.56 points, or 0.65%, to 7,441.53.

The top performing stocks in this index were UNITI GROUP and GOODMAN GROUP, up 9.28% and 3.54% respectively. The bottom performing stocks in this index were REGIS RESOURCES and IMUGENE, down 14.29% and 8.96% respectively.

Shares of materials and resources were major drag on the market, with South32 falling 4% after the diversified miner warned that COVID-19 curbs may further hit labour shortages at its flagship Illawarra mine. Rio and BHP slipped 0.7% and 0.2%, respectively.

Home furnishing retailer Adairs plunged 21.5 percent on a weak earnings outlook.

Fiber infrastructure provider Uniti Group jumped 9.3 percent after saying "more than one party" have shown interest in buying the company.

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ECONOMIC NEWS: Australia Manufacturing PMI Eases To 55.3 In January- Australia manufacturing sector continued to expand in January with a manufacturing PMI score of 55.3, the latest survey from Markit Economics revealed on Monday. That's down from 57.7 in December, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. New order growth eased at the start of the year while manufacturing output slipped into contraction for the first time in five months. Although demand persisted in growth, Australian manufacturers reported a slowdown in production, affected by the shortages of inputs, labor constraints and other COVID-19 disruptions. Suppliers' delivery times lengthened at a more severe rate, implicated by the worsening of COVID-19 conditions. This led to firms ramping up their input purchases with intentions of safety stock building. Meanwhile hiring activities decelerated with panelists reporting difficulties in securing labor. The survey also showed that the services PMI tumbled to 45.0 from 55.1 in December, while the composite PMI dropped to 45.3 from 54.9.

CURRENCY NEWS: In the currency market, the U.S. dollar traded 0.16% higher at 95.797 against a basket of its peers.The Australian dollar dropped 0.26% to $0.7164.

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First Published: Jan 24 2022 | 4:58 PM IST

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