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ASX slips despite Wall Street recovery

AUSTRALIAN ECONOMY
Softer-than-expected producer price data failed to ease the concerns of inflation-worried investors. Picture: NCA Newswire / Gaye Gerard

Australian shares slipped over Friday’s session, as a broad sell-off in consumer stocks, materials, financials and energy stocks weighed on the benchmark.

At the closing bell, the S&P/ASX200 shed 0.3 per cent, or 25.5 points, to 7788.1, as eight of 11 industry sectors finished in the red. Despite the sell-off, shares eked out modest gains over the week to finish 0.2 per cent higher.

Meanwhile the broader All Ordinaries shed 0.3 per cent of its value over Friday’s session.

Against the greenback, the Australian dollar was buying US65.23c at 4pm.

While the local benchmark struggled to gain momentum, Wall Street rebounded overnight as cooler-than-expected producer prices followed Wednesday’s inflation-induced sell-off.

Stock Market Drops And Recovers Ahead Of Inflation Data Announcement
Softer-than-expected producer prices eased fears among inflation-worried investors. Picture: AFP / Michael M. Santiago

On Wall Street, tech stocks led the rally, with the Nasdaq climbing 272 points or 1.7 per cent to hit a fresh record. The S&P500 added 0.7 per cent while the Dow Jones Industrial Average shed just 2 points, or less than 0.1 per cent.

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Even as traders slashed their rate cuts bets following the hotter-than expected CPI reading, ANZ chief economist Adam Boyton said he doubted there were significant implications for the Reserve Bank.

“We don’t think there are too many local conclusions to draw from this, although the persistence of US inflation is a reminder that Australia’s path to within‑target inflation is unlikely to be linear,” Mr Boyton said.

“As a result, we think it will be some time before the first RBA easing.”

On the benchmark, consumer staples were the biggest laggards, falling 0.9 per cent, as sector heavyweights Coles shed 1.2 per cent to $16.15 and Woolworths dipped 1.1 per cent to $32.22.

The financials and materials sectors also fell, losing 0.2 per cent and 0.4 per cent, respectively.

Meanwhile, utilities stocks were the top performers, adding 1.3 per cent, as sector heavyweight Origin Energy advanced 2.3 per cent to $9.76.

The electricity and natural gas retailer has entered an agreement with Virya Energy to acquire its Yanco Delta Wind Farm, located in NSW, in a deal worth as much as $300m subject to the achievement of certain development milestones.

STAR CASINO GV's
Embattled casino operator Star Entertainment reported fewer patrons in its VIP gaming areas. Picture: NCA NewsWire / Damian Shaw

In other corporate news, Star Entertainment’s woes continued after it reported a $6.8m loss in the March quarter as high rollers deserted its venues and operating costs soared. Shares plunged 7.3 per cent to 51c.

Online luxury fashion retailer Cettire shed 6.9 per cent to $3.12 even as it reported an 88 per cent increase in sales for the March quarter to $191m compared with the same period a year earlier.

Shares in Domino’s Pizza slipped 7.5 per cent to $40.17 as Don Meij, chief executive of the struggling fast food chain, told investors he planned to expand store numbers in Japan to 2000, up from its current level of 1015.

Building products manufacturer Boral rose 1.5 per cent to $6.12 after the company recommended a takeover bid worth $1.5bn from its largest shareholder, the Kerry Stokes-controlled Seven Group. Shares in Seven inched 0.1 per cent higher to $40.07.