ASX closes down slightly as market digests data
The local share market has closed slightly lower following a see-saw trading session marked by the release of weaker-than-expected domestic economic data that could lessen the odds of more rate hikes.
The benchmark S&P/ASX200 index was down as many as 42 points, or 0.5 per cent in morning trading, before climbing 14 points, or 0.2 per cent into positive territory in the early and mid afternoon.
But ultimately it faded in the late afternoon to finish Wednesday down 6.8 points, or 0.1 per cent, to 7,251.6. The broader All Ordinaries closed down 1.9 points, or 0.03 per cent, to 7,456.1.
Shortly before lunchtime the Australian Bureau of Statistics reported that Australia's gross domestic product rose 0.5 per cent in the fourth quarter, lower than economists were expecting.
"I think this is a number that is not that easy to digest," said IG market analyst Hebe Chen.
"On the positive side, yes, it's showing that our economy still grew 2.7 per cent year over year, but this is lowest pace in the past five quarters.
"It looks like the market participants are looking on the positive side, that we still have a buffer for a soft landing."
The ABS also announced on Wednesday that inflation decelerated in January, with consumer prices rising 7.4 per cent in the past 12 months, down from 8.4 per cent in the year to December.
NAB economist Taylor Nugent said while the monthly CPI readouts weren't as informative as the quarterly figures - they don't capture many service-sector price hikes - the data release did support the case that Australian inflation had peaked. As such, the bank expects the Reserve Bank to hike rates just twice more, in March and April, and then pause.
Ms Chen said the market was also reacting to Chinese official purchase managers' index (PMI) data beating expectations, showing that factory activity last month was at an 11-year high.
That led to a solid performance by the ASX's materials and energy sectors, which were the only ones in the green on Wednesday. Energy climbed 1.6 per cent and materials gained 2.3 per cent.
BHP added 2.3 per cent to $46.22, Fortescue Metals gained 3.4 per cent to $22.12 and Rio Tinto finished up 2.5 per cent at $119.63.
Also, Woodside was up 2.5 per cent to $36.80 and Yancoal gained 5.1 per cent to $6.16 amid talk it would pursue a bid for BHP's Daunia and Blackwater coalmines in Queensland.
All the big banks were down significantly, with NAB dropping 2.1 per cent to $29.38, Westpac falling 2.0 per cent to $22.07, ANZ down 1.1 per cent to $24.37 and CBA down 1.6 per cent to $99.05.
Former small cap darling Pointerra plunged 22.6 per cent to a two and a half year low of 12c after the 3D dataset company announced lacklustre half-year results.
Pointerra said there had been "unavoidable program delays" with key US energy utility customers, leading to a delay in invoicing and a drop in cash receipts.
Also, Dubber plunged 25.8 per cent to 23c after the cloud-based call recording company announced a half-year loss of $37m, on revenue of just $16m. It announce plans to restructure the business to save $5m a quarter.
The Australian dollar was buying 67.58 US cents, from 67.24 US cents at Tuesday's ASX close.
ON THE ASX:
* The benchmark S&P/ASX200 index finished Wecdnesday down 6.8 points, or 0.09 per cent, at 7,251.6.
* The broader All Ordinaries dropped 1.9 points, or 0.03 per cent, to 7,456.1.
One Australian dollar buys:
* 67.60 US cents, from 67.24 US cents at Tuesday's ASX close
* 92.16 Japanese yen, from 91.67 Japanese yen
* 63.76 Euro cents, from 63.53 Euro cents
* 56.10 British pence, from 55.84 pence
* 108.59 NZ cents, from 109.37 NZ cents.