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Utilities (down 0.9 per cent) were also softer as shares in Mercury NZ fell 3.9 per cent,AGL lost 2.7 per cent and Meridian Energy dropped 1.9 per cent. BlueScope Steel (down 3.2 per cent),Amcor (down 2.6 per cent) and Lynas Rare Earths (down 1.3 per cent) were also among the biggest large-cap decliners.
The lowdown
AMP chief economist Shane Oliver said despite shares on several international bourses rising this week,Australian shares were weaker,driven by resources shares and disappointment that the Reserve Bank was still maintaining a tightening bias.
“We remain of the view that shares have run a bit ahead of themselves and are now overbought and at risk of a short-term correction,” Oliver said. “Risks around central banks and the timing of rate cuts,recession risks and various geopolitical issues[including the escalating Middle East conflict] all provide potential triggers.”
On Wall Street,stocks held near record levels as evidence kept piling up to show the job market remains remarkably solid.
The S&P 500 edged up 0.1 per cent,crossing the 5000 point mark for the first time before dipping back below the milestone at the close. The Dow rose 0.1 per cent,and the Nasdaq composite was 0.2 per cent higher.
The US economy has blown past earlier expectations of a recession,and the latest show of strength came from a report indicating fewer workers applied for unemployment benefits last week than expected. The number remains low relative to history,even if layoffs at Google’s parent company,Macy’s and other big-name companies have been getting attention recently.
In prior months,such a report may have hurt the stock market because of concerns that it would mean a longer wait for cuts to interest rates from the Federal Reserve. But investors have been coming around to the idea that good news on the economy is good for stocks because it will drive profits for companies,and futures tied to the S&P 500 rose after the report.
The latest set of earnings reports from big US companies were also keeping the stock market mixed overall.
Disney jumped 11.5 per cent after it reported stronger profit for the latest quarter than analysts expected. It benefited from cost cuts and growth at its theme parks.
Ralph Lauren was another winner,rising 16.8 per cent after its profit and revenue topped Wall Street’s forecasts. It said it saw strong holiday sales around the world,led by Asia.
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New York Community Bancorp was having another sharp zigzag day and went from an early loss of nearly 10 per cent to a gain and back to a loss of 6.5 per cent. Its stock has dropped nearly 60 per cent since it shocked investors across the banking industry with a surprise loss last week,and Moody’s cut its credit-rating to “junk” status earlier this week.
Stocks of other regional banks have also been swinging sharply lately,forcing uncomfortable memories of last year’s banking crisis.
In the bond market,the yield on the 10-year Treasury ticked up to 4.15 per cent from 4.12 per cent late Wednesday.
In stock markets abroad,indexes rose across much of Asia and Europe.
Stocks climbed 1.3 per cent in Shanghai after China replaced its top stock market regulator late Wednesday with an industry veteran nicknamed the “broker butcher,” analysts say,due to his record for cracking down on market abuses such as insider trading. Stocks fell 1.3 per cent in Hong Kong,though.
Beijing has been struggling to prop up what have been some of the world’s worst-performing markets this year.
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“Australians travelling to see friends and family or for work are consistently let down by cancelled and delayed flights,” said Senator McKenzie and Senator Smith in a statement as the Coalition attempts to push new legislation through the Senate that couldcompel airlines to compensate passengers for delays.
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