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Australia Market tumbles on Fed policy tightening worries

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Capital Market
Last Updated : Jan 06 2022 | 10:51 PM IST
The Australian share market finished lower for second straight session on Thursday, 06 January 2022, on tracking sharp losses on Wall Street overnight after minutes from the U.S. Federal Reserve showed it was planning to raise interest rates sooner than expected and wind back stimulus soon to tame high inflation. Meanwhile, the increase in COVID-19 cases to a new record also weighed on the market. All sectors ended in the red, with education stocks, real estate and technology firms led the declines.

At closing bell, the benchmark S&P/ASX200 was down 207.53 points, or 2.74%, to 7,358.32. The broader All Ordinaries index sank 220.36 points, or 2.79%, to 7,679.28.

The top performing stocks in this index were PALADIN ENERGY and RIO TINTO, up 1.63% and 0.73% respectively. The bottom performing stocks in this index were PINNACLE INVESTMENT MANAGEMENT GROUP and AFTERPAY, down 13.14% and 10.76% respectively.

ECONOMIC NEWS: Australia Private Sector Output Growth Slows In December - Australia's service sector continued to expand in December, according to the latest IHS Markit PMI data, though the rate of growth slowed. The seasonally adjusted Business Activity Index fell to 55.1 in December from 55.7 in November, signalling a slower expansion. That said, the rate at which business activity rose remained at a level above the 2021 average to indicate solid growth post the easing of COVID-19 restrictions, according to panellists. The easing of COVID-19 restrictions nevertheless enabled overall new orders to rise at a stronger rate in December, driving higher employment levels and contributing to increased backlogged work. Price pressures further accumulated with record input price inflation seen while business confidence slipped in the final month of 2021. The Composite Index, which measures combined services and manufacturing output, eased to 54.9 in December from 55.7 in November. This indicated a slower rate of private sector output growth, though the rate of growth remained at a level above the series average.

CURRENCY NEWS: The Australian dollar changed hands at $0.7158 after seeing an earlier high of $0.7222.

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First Published: Jan 06 2022 | 5:31 PM IST

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