Australia Market extends losses for second day on profit booking

Headline indices of the Australian stock market declined for second straight session on Friday, 05 April 2019, as investors continued withdrawing profit off the table on following the mixed cues from Wall Street overnight and as investors digested data showing that the construction sector in Australia continued to contract in March. Every ASX sector ended the day in negative territory today, with the tech sector saw the largest fall in%age terms followed by consumer staples and property trusts but financials and healthcare were the main weight and contributed most to broader losses. At closing bell, the benchmark S&P/ASX200 index declined 51.49 points, or 0.83%, at 6,181.26 points, while the broader All Ordinaries fell 49.83 points, or 0.79%, at 6,270.59.

Today's losses come despite lift on trade optimism. As per reports, Vice Premier Liu He said a new consensus had been reached on the text of an economic and trade agreement. While the two nations are much closer to a deal, intellectual property and theft along with certain tariffs remain sticking points.

 

Shares of materials were mixed, with Mining giant BHP Group lost 0.5% to A$29.22 while Rio Tinto gained 0.3% to A$99.91. Fortescue Metals was up 1% to A$7.78 after Moody's Investors Service said the approval of its Iron Bridge magnetite iron ore project south of Port Hedland, WA, would create near-term risks but long-term benefits and left its bond rating unchanged.

The big four banks were all lower, with NAB down 1.4% to A$24.81, ANZ down 1.2% to A$25.95, Westpac down 0.69% to A$26.05 and Commonwealth down 0.48% to A$70.89.

Automotive Holdings (AHG) has surged 20.7% after receiving a takeover offer from AP Eagers (APE), with an offer of 1 APE share for every 3.8 AHG shares. Both stocks rallied on the news with APE also lifting 5.6%.

In economic news, the latest survey from the Australian Industry Group revealed that the construction sector in Australia continued to contract in March, albeit at a slower rate, with a Performance of Construction Index score of 45.6. That's up from 43.8, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction.

CURRENCY: The Australian dollar strengthened against the U.S. dollar on Friday, on improved global outlook. The Australian dollar was quoted at 71.25 US cents, from 71.16 US cents on Thursday.

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