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FIVE at FIVE AU: ASX down but confidence up

Published 12/11/2024, 04:06 pm
Updated 12/11/2024, 04:30 pm
© Reuters.  FIVE at FIVE AU: ASX down but confidence up
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The ASX200 Index has dropped for a second straight day, ending the session 10.6 points, or 0.13%, lower at 8,255.6 points.

The weakest sectors were Energy and Materials, each down more than 1.4%, after China continued to hold back on major fiscal stimulus in its Friday policy announcements. Healthcare and Consumer Staples were also weak.

Led by Rio Tinto (ASX:RIO), major iron ore miners declined, as did coal companies with Yancoal down 3.4% and Whitehaven Coal (ASX:WHC) lost 2.1%,

The best-performing sectors were Tech stocks and Utilities, up 1.3% and 1% respectively.

Paladin Energy (ASX:PDN) shares have fallen 28% today to trade below $7 per share for the first time since June last year. The sell-off came as PDN said it faced ongoing production challenges and operational variability at its Langer Heinrich Uranium Mine in Namibia.

The ACCC has reported significant increases in domestic airfares following the exit of Rex from major domestic routes. Average prices on major city routes have risen by 13.3% since the budget airline suspended its operations in July, and Qantas and Virgin Australia now account for 98% of all domestic passengers.

Business confidence up

Australian business confidence experienced a significant uplift in October, reaching its highest point since early 2023, according to the latest National Australia Bank (NAB) Monthly Business Survey.

The services sectors, excluding mining, reported the strongest conditions. Conversely, the goods sectors, particularly manufacturing and retail, continued to face challenges, with both sectors recording negative conditions.

“Overall, the survey continues to paint a picture of resilient activity levels in the economy and a trend easing in price and cost pressures, though with capacity utilisation still high it will likely take more time before inflation pressures normalise,” says NAB head of Australian economics, Gareth Spence.

“Capacity utilisation declined by a relatively sharp 0.7 percentage points but remains well above its long-run average.”

Consumers confident too

Likewise, Australian consumer sentiment continues to rebound according to the Westpac-Melbourne Institute Consumer Sentiment Index.

The index rose 5.3% to 94.6 in November from 89.8 in October, with consumers now optimistic about the economy and their finances, albeit there was some pullback after the US election.

“The consumer recovery gained more traction through October-November but the survey detail suggests some of this momentum has been checked by renewed uncertainty following the US election,” says Westpac head of Australian macro-forecasting Matthew Hassan.

Small cap gains

Jindalee Lithium Ltd (ASX:JLL, OTCQX:JNDAF) followed up yesterday's double-figure gain with another 30.36% increase to $0.365 while International Graphite Ltd (ASX:IG6) was up to 29.63% higher to $0.07.

Among other small cap gainers were Cadoux Ltd (ASX:CCM, OTCQB:FYIRF), which was as much as 21.43% higher to $0.051, Reward Minerals Ltd (ASX:RWD) gained as much as 14.29% to $0.088, Latin Resources Ltd (ASX:LRS, OTC:LRSRF) traded up to $0.2075, a 12.17% increase on yesterday's close and American Rare Earths Ltd (ASX:ARR, OTCQB:ARRNF) was up to 8.52% higher to $0.235.

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