Australian shares end five-day rally after miners drag; Woolworths increases consumer staples
Australian shares fell on Thursday, ending a five-day rally, as mining stocks weighed down the benchmark. Consumer staples rose, led by Woolworths, the country's largest grocer, which reported better-than expected third-quarter sales.
By 0040 GMT, the S&P/ASX 200 Index was down 0.1% to 8,116.10 point. The benchmark index rose by 0.7% on Tuesday.
The local exchange saw the biggest drop in the benchmark index, with a 1.6% decline, as the iron ore futures fell amid fears of steel production cuts by China, the top steel consumer.
BHP Group, the world's largest listed mining company, fell 2.2% while Rio Tinto dropped 1.7%.
In contrast, Australian consumer staples rose 0.7%, led by the 1.6% increase in Woolworths' sales, which were better than expected in its third quarter, as price reductions drove up volumes in its core grocery businesses.
Oil prices fell in response to a global trade conflict that has affected fuel demand. Energy stocks dropped over 1%.
Sector leader Woodside Energy fell 2.1%, followed by smaller rival Santos' 0.8% decline.
As bullion prices dropped, gold stocks also declined by 0.5%.
The financial stocks fell 0.3% and ended a winning streak of 10 days. The "Big Four' lenders were down between 0.1 and 0.6%.
Data released on Wednesday in Australia showed that local core inflation fell to its lowest level in three years in the first quarter. This strengthened the argument for the central bank to cut rates in the next few weeks.
Reserve Bank of Australia is scheduled to hold a two-day meeting of monetary policy on May 19th.
According to RBA Ratetracker, 56% of participants in the market expect the RBA will cut its cash rate from the current level of 4.10% to 3.60% by April 30.
The benchmark S&P/NZX50 index in New Zealand rose by 0.5%, to 11,966.32 point.
(source: Reuters)