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Five at Five AU: ASX falls on weakness in Tech, Financials and Energy despite strong lithium stock gains

Published 11/09/2024, 03:41 pm
Updated 11/09/2024, 04:30 pm
© Reuters.  Five at Five AU: ASX falls on weakness in Tech, Financials and Energy despite strong lithium stock gains
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The ASX has fallen 33.2 points or 0.41% despite strong lifts in lithium mining stocks, which have been struggling amid low lithium prices in recent months.

There was strength in Materials, up 1.37%, but it wasn’t enough to make up for losses in Energy stocks (-1.63%), Info Tech (-1.61%) and Financials (-1.65%).

Woodside Energy Ltd fell 2.46%, NextDC fell 5.55% to take the crown as biggest loser on the ASX200 and ANZ fell 2.29% – Commonwealth Bank, NAB and Westpac weren’t far behind, all losing between 1.80% and 1.89%.

The other sectors were mostly flat, with some weakness in Comm services and small lifts in Utilities and Real Estate.

Lithium miners were the standout on the ASX200 today. Mineral Resources lifted 16.47% after Australia’s Foreign Investment Review Board approved the sales of its 49% interest in the Onslow Iron Haul Road.

Fellow miners Liontown Resources (ASX:LTR) (+14.75%), Pilbara Minerals (+13.98%), Latin resources Ltd (+15.63%) and Core Lithium (+13.64%) benefited from the shift to a more bullish lithium market sentiment.

Overall, the index has lost 0.35% over the last five days of trading and currently sits 2.09% below its 52-week high.

US markets could break through barrier if CPI softens

“The tech rally and buy-the-dip trend continued for a second day, with the Nasdaq gaining 0.8% and the S&P 500 rising 0.5%, though both indices stopped short of breaking through key levels as caution set in,” writes moomoo market strategist Jessica Amir.

“The market’s hesitation to push past these levels is symbolic, as investors await the Trump-Harris inaugural debate and fresh US inflation reports, which could influence the Federal Reserve's upcoming rate decision.

“There's a 33% chance of a 0.5% cut, while markets have fully priced in a 0.25% cut (with a 133% probability).

“If the CPI matches or is softer than expected, it could help the market break through key levels.

“However, September sentiment remains cautious, not just because of these factors but also due to growing concerns in the banking sector, reflecting the declining financial health of US consumers.

“Banking shares dropped, with JPMorgan (NYSE:JPM) down 5%, marking its biggest decline since April, as its president noted that analysts were too optimistic about next year's net interest income.

“Meanwhile, Bank of America’s CEO stated that its results would be flat, lower than Wall Street expected.

“This follows a Federal Reserve Bank of New York survey indicating delinquency concerns are at their highest since April 2020. The Fed’s Barr also unveiled sweeping new capital plans.

“Elsewhere, Tesla (NASDAQ:TSLA) was in the spotlight again, with shares rising 4.6% after BMW lowered its profit expectations due to brake faults, and Volkswagen (ETR:VOWG_p) scrapped its three-decade-old German jobs pledge to cut costs.

“VW had already announced last week that it might close factories in Germany as it battles declining sales.”

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