ASX slips as energy, real estate and mining stocks slide
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The news: The Australian sharemarket has continued to grind lower, following an overnight selloff on Wall St after a "less dovish" pivot from a Federal Reserve Official. China's economy managed to hit its annual growth target for 2023, but undershot expectations and is facing weaker forecasts for 2024.
The numbers: The ASX 200 benchmark index lost 0.29% to 7,393.10, as a slide in oil prices weighed on energy stocks (-1.2%) and higher-for-longer interest rate bets took a toll on real estate stocks (-0.8%). Miners also faded, with materials stocks down 0.8% with big drops at South32 (-3.5%), Northern Star (-3.9%) and Pilbara Minerals (-2.6%).
The Australian dollar has lost almost 0.8% against the greenback since yesterday, after Federal Reserve governor Christopher Waller warned against cutting interest rates too quickly. The Aussie is buying 65.6 US cents, and a rush back to the US dollar extended the drag on gold prices.
Oil prices fell after China slightly undershot economic growth expectations, and forecasts pointed to lower growth and weaker expected commodity demand in 2024. Brent crude futures are 0.6% lower than yesterday, trading at USD77.36 a barrel, while West Texas futures have fallen to USD71.86.
The context: Two more Federal Reserve governors are set to speak overnight, alongside US retail sales and industrial production data prints for December. European Central Bank President Christine Lagarde will address the World Economic Forum in Davos to discuss "How to Trust Economics".
