Australian stocks ended Tuesday’s session in the negative, as slumps in building approvals and the Reserve Bank pledging to maintain rates at historical lows weighed on sentiment.
The benchmark S&P/ASX 200 index dipped 27.3 points, or 0.4 per cent, to 6762.3, falling from a high of 6860.7 set earlier in the trading day.
The broader All Ordinaries Index fell 32.8 points, or 0.5 per cent, to 7009.9, while the Australian dollar was fetching 77.56 US cents and gold was trading at $US1715.42 at the close of trade.
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OpenMarkets chief executive Ivan Tchourilov said the index started the session strong but faded following a day of hefty economic data releases that dented building and material stocks.
“Building and material stocks are feeling the pinch today after building approvals data released were far worse than expected, showing a 19 per cent decline last month,†Mr Tchourilov said.
“National house prices are on a tear at the moment and there’s a lot of activity in that space, so it’s come as a surprise to the market.”
Axi market strategist Stephen Innes in a note said the RBA’s decision to maintain rates for the foreseeable future was “dovishâ€, and its push to combat higher yields would be a headwind for the Australian dollar.
“Relative yield differentials are a headwind for AUD/USD, with the pair needing renewed strength in commodity prices to rally once more,†Mr Innes said. “Rates vs commodities are the battleground for the AUD in 2021.â€
A2 Milk witnessed the largest market gain, with its share price rising 7.6 per cent to $9.54 each.
Automotive group AP Eagers was also able to shake off the market blues, rising 4.5 per cent to $14.16 per share.
Gold Road Resources suffered the largest share price tumble, slumping 8.1 per cent to $1.08 each.
Stock in construction group CIMIC fell off the back of the weaker building approval data from the Australian Bureau of Statistics, tumbling 6.9 per cent to $19.85 per share.
Major banks were able to buck the negative trend felt in the market, with Commonwealth Bank inching up 0.45 per cent to $84.49 a share, while ANZ jumped 1.1 per cent to $26.89 per shares.
Westpac shares ended the session 0.1 per cent higher to $24.16, and NAB stock rose 0.5 per cent to $25.26 each.
Rio Tinto fell 0.4 per cent to $127.18 per share, while its major rival BHP drooped 1.9 per cent lower to $49.13 per share and Fortescue Metals was hit by a 4.7 per cent fall to $21.61 per share.
Stock in Qantas closed 2.2 per cent lower to $4.89 per share, and Telstra shares ended down 1.3 per cent to $3.11 each.
Woolworths shares rose 0.5 per cent to $40.50 each, and Wesfarmers closed the day down 0.2 per cent to $50.63
Business Reporter
Gerard Cockburn is a business reporter. Prior to joining The Australian, he has worked as a journalist for the Courier Mail and published in The Age.
