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ASX takes tech hit before US giants report

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Investors rushed to sell technology stocks and the Australian market fell for a second consecutive day in the leadup to US tech giants reporting earnings this week.

The benchmark S&P/ASX200 index closed lower by 11.8 points, or 0.17 per cent, to 7033.8 on Tuesday.

The main index remains less than 200 points from its record, 7197.2.

The All Ordinaries closed lower by 12.3 points, or 0.17 per cent, to 7295.5 points.

Information technology shares had the biggest drop, 2.53 per cent.

Buy now, pay later provider Zip shed 6.31 per cent to $8.02. Rival Afterpay lost 5.53 per cent to $115.96.

US giants Microsoft, Google parent Alphabet, Apple and Facebook report earnings this week.

Deep Data Analytics chief executive Mathan Somasundaram had no doubt this was contributing to investors selling.

"We've seen substantial money coming out of tech funds in the last week, leading to update week," he said.

"There is big risk."

Underperforming US tech giants could affect ASX healthcare shares too, according to Mr Somasundaram.

He cited biotech giant CSL as a high growth stock. Shares dropped 1.24 per cent to $268.37.

Mr Somasundaram also said investors were wary of a two-day US Federal Reserve meeting, beginning Tuesday.

The US central bank is expected to discuss whether gains in employment have affected its plan to leave rates near zero.

Meanwhile the S&P 500 and Nasdaq closed at record highs, helped by Tesla earnings.

Domestically, people in Perth and the neighbouring Peel region enjoyed freedom after a three-day coronavirus lockdown.

Western Australian Premier Mark McGowan defended the decision, which cost the economy about $70 million, after two infected people left a quarantine hotel.

Meanwhile Australia blocked direct flights from India until May 15 as the latter struggles with record infections.

Australia pledged aid after India recorded 323,144 infections in 24 hours.

Also on the ASX, gambling giant Tabcorp received a $3.5 billion offer for its wagering business.

The improved offer from the UK-based sports betting group Entain, which owns Ladbrokes, was unsolicited, Tabcorp said.

Shares were up 4.17 per cent to $5.00.

BlueScope Steel raised its second-half earnings forecast, largely due to surging steel prices in the US.

Prices and demand were also higher for Australian steel products, the company said.

Second-half earnings were forecast to be between $1 billion and $1.08 billion, better than the previous range from $750 million to $830 million.

Shares were higher by 0.5 per cent to $22.16.

Meanwhile iron ore prices climbed to $US191 per tonne.

BHP climbed 1.13 per cent to $48.38, Fortescue gained 1.15 per cent to $22.96 and Rio Tinto increased by 0.92 per cent to $123.64.

Waste management group Bingo Industries urged investors to accept a $2.3 billion takeover offer from Macquarie Group.

Bingo said a committee set up to consider the offer recommended investors accept the bid, from a Macquarie Infrastructure and Real Assets (MIRA) company.

Shares in Bingo rose 6.25 per cent to $3.40.

In banking, ANZ was best of the big four and rose 0.91 per cent to 28.95.

Family app developer Life360 surged by 13 per cent to $5.91 after it said it would buy wearable device provider Jiobit for at least $US37 million.

On Wednesday, economists expect inflation for the first three months of the year of 0.9 per cent, lifting the annual rate to 1.4 per cent.

Westpac analysts said they do not expect the result to affect markets.

Coles will reveal sales from its third quarter.

The Australian dollar was buying 77.87 US cents at 1716 AEST, higher from 77.69 US cents at Monday's close.

ON THE ASX

* The benchmark S&P/ASX200 index closed lower by 11.8 points, or 0.17 per cent, to 7033.8 on Tuesday.

* The All Ordinaries closed lower by 12.3 points, or 0.17 per cent, to 7295.5 points.

* At 1716 AEST, the SPI200 futures index was up by four points, or 0.06 per cent, to 7008.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 77.87 US cents, from 77.69 cents on Monday

* 84.34 Japanese yen, from 83.80 yen

* 64.52 Euro cents, from 64.28 cents

* 56.09 British pence, from 55.85 pence

* 107.80 NZ cents, from 107.83 cents.