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ASX dips as miserly week continues

·3-min read

Investors have continued to shy away from the ASX this week as some wonder whether rising inflation could finally be followed by wage increases.

Miners BHP and Fortescue each lost more than two per cent on Wednesday as materials and energy shares caused a third consecutive down day for the market.

Higher prices continue to be one of the consequences of economies restarting from coronavirus shutdowns.

Factory gate prices in China soared 13.5 per cent year-on-year to October, data showed, beating forecasts. US consumer inflation figures are due tonight.

In Australia on Thursday, job figures for October will be analysed in the context of lockdowns ending in some eastern states.

However, JP Morgan economist Tom Kennedy was looking to next week's third-quarter wages data.

He was interested to see whether the recent rise in inflation in Australia would be followed by wage increases.

The annual inflation rate is three per cent, within the Reserve Bank's target range for a rate rise.

Yet the central bank also wants annual wage growth higher than the current 1.7 per cent before a hike.

Mr Kennedy said he expected next week's numbers to show two per cent wage growth, owing to lingering lockdown effects.

He also noted the Fair Work Commission will spread award wage increases over the second half of the financial year. This will limit immediate impact.

On the market on Thursday, there are annual general meetings for companies including Austal, BHP and Nine.

On Wednesday, the benchmark S&P/ASX200 index closed lower by 10.3 points, or 0.14 per cent, to 7423.9.

The All Ordinaries closed down 18.9 points, or 0.24 per cent, to 7737.4.

National Australia Bank shares closed up more than four per cent after posting a booming full-year profit a day earlier.

ANZ, Bank of Queensland, Bendigo, the Commonwealth and Westpac each gained less than one per cent.

Chalice Mining shares continued to do well after Tuesday's news of the discovery of a large nickel sulphide deposit.

The finding was made at the company's Julimar site outside Perth.

Shares were up almost five per cent after a gain of 28.51 per cent a day earlier.

A merger of Santos and Oil Search is still on track despite a postponed court hearing.

Papua New Guinea's national court deferred its hearing of the merger from today to Thursday.

Oil Search shares were down almost one per cent to $4.24.

Santos shares were down almost half a per cent to $6.92.

Property group Mirvac has returned some of the JobKeeper wage subsidies collected from the government.

The company returned the $10.4 million collected last financial year.

It is yet to repay the $8.9 million collected in the 2020 financial year.

Shares were up 0.7 per cent to $2.88.

Shaver Shop investors were happy to learn year-to-date sales were only marginally down, given lockdowns in some states.

Total sales were down 0.9 per cent on the same period last year.

The company did not give an earnings forecast.

Shares were up almost three per cent to $1.06.

The Australian dollar was buying 73.57 US cents at 1727 AEDT, lower from 74.14 cents at Tuesday's close.


* The benchmark S&P/ASX200 index closed lower by 10.3 points, or 0.14 per cent, to 7423.9 on Wednesday.

* The All Ordinaries closed down 18.9 points, or 0.24 per cent, to 7737.4.

* At 1727 AEDT, the SPI200 futures index was up five points, or 0.07 per cent, at 7417 points.


One Australian dollar buys:

* 73.57 US cents, from 74.14 cents on Tuesday

* 83.03 Japanese yen, from 83.72 yen

* 63.54 Euro cents, from 63.95 cents

* 54.28 British pence, from 54.65 pence

* 103.60 NZ cents, from 103.55 cents.

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