Australian Stock Market Closes Down Amid Investor Caution

Strategic Insights -

The Australian stock market closed down on Monday, with the all ordinaries index slipping 6.9 points to 2849.4, recovering from an intraday low of 2834.2 points. This decline came despite a rally in resource stocks following firmer commodity prices. The all resources index jumped 24.5 points or 2.58 per cent to 975.0 points, while the all industrials index tumbled 37.4 to 5135.9 points.

The market's cautious attitude was largely driven by concerns over the potential impact of a strengthening US economy on Australian monetary policy. Henderson Charlton Jones dealer Michael Baker attributed the concerns to a possible tightening bias rather than further interest rate cuts. The majors, including BHP, Rio Tinto, and WMC, strengthened following improved base metal prices in London, with nickel being the star performer.

Key Takeaways:

  • The Australian stock market closed down on Monday, with the all ordinaries index slipping 6.9 points to 2849.4.
  • The all resources index jumped 24.5 points or 2.58 per cent to 975.0 points, while the all industrials index tumbled 37.4 to 5135.9 points.
  • Concerns over the potential impact of a strengthening US economy on Australian monetary policy drove investor caution.
  • The majors, including BHP, Rio Tinto, and WMC, strengthened following improved base metal prices in London.
  • Nickel was the star performer, with Pasminco strengthening six cents to $1.24.
  • Another takeover play emerged in the resource sector, with Normandy Mining and Joseph Gutnick announcing a $1.50 share offer to mop up ownership of Great Central Mines.
  • The gold index eased 3.7 points to 1132.0, with the spot price of gold bullion $US290.90 an ounce in Sydney this afternoon.
  • Interest rate sensitive bank stocks took a dive, with the industry sub index offloading 98.2 points to 6555.3.
  • National Australia Bank tumbled 38 to $25.92, Westpac slumped 28.7 to $10.995, and Commonwealth Bank retreated 24.4 to $22.956.

Statistics:

  • Preliminary national turnover was 357.51 million shares traded for $1.006 billion, with falling stocks outnumbering rising stocks 644 to 535 and 453 stocks steady.
  • Savage resources was the most traded stock on the bourse, with 17.61 million shares changing hands for $14.33 million.
  • On the Sydney Futures Exchange, the March share price index contract shed 10 to 2863.0 - a 13.6 point premium to the cash market - with 8860 lots traded.
  • Overseas, the Nikkei in Japan was 14 points down at 13378.0 in afternoon trade, and Hong Kong's Hang Seng 51.2 points higher at 10773.9.

Sources:

  • The Australian stock market closed down on Monday, with the all ordinaries index slipping 6.9 points to 2849.4. (Source: BRISBANE, Jan 11, 1999)
  • The all resources index jumped 24.5 points or 2.58 per cent to 975.0 points, while the all industrials index tumbled 37.4 to 5135.9 points. (Source: BRISBANE, Jan 11, 1999)
  • Henderson Charlton Jones dealer Michael Baker attributed the concerns to a possible tightening bias rather than further interest rate cuts. (Source: BRISBANE, Jan 11, 1999)
  • Pasminco strengthened six cents to $1.24. (Source: BRISBANE, Jan 11, 1999)
  • Another takeover play emerged in the resource sector, with Normandy Mining and Joseph Gutnick announcing a $1.50 share offer to mop up ownership of Great Central Mines. (Source: BRISBANE, Jan 11, 1999)
  • The gold index eased 3.7 points to 1132.0, with the spot price of gold bullion $US290.90 an ounce in Sydney this afternoon. (Source: BRISBANE, Jan 11, 1999)
  • Interest rate sensitive bank stocks took a dive, with the industry sub index offloading 98.2 points to 6555.3. (Source: BRISBANE, Jan 11, 1999)
  • National Australia Bank tumbled 38 to $25.92, Westpac slumped 28.7 to $10.995, and Commonwealth Bank retreated 24.4 to $22.956. (Source: BRISBANE, Jan 11, 1999)