The Australian sharemarket dropped on Monday after a sell-off in commodity prices hit the mining giants, with both BHP and Rio Tinto tumbling more than 2 per cent.
The S&P/ASX 200 Index fell 62.3 points, or 0.7 per cent, to 8635, tracking broad weakness on Wall Street amid investor jitters about the US tech sector. On the ASX, the materials sector was by far the biggest detractor on the bourse, leading 10 of the 11 sectors into the red.
That’s after copper fell more than 3 per cent on Friday from a record high, while iron ore futures lost as much as 1.6 per cent in Singapore to $US100.70 a tonne on Monday, after China said it would introduce a licensing system on the export of certain steel products from January.
“A risk-off tone across markets weighed on sentiment across the base metals complex, with copper giving up gains achieved earlier in the week,” ANZ wrote in a report to clients. “A sell-off in AI-focused stocks [has] triggered profit-taking by investors.”
That profit-taking hit the index heavyweights, with BHP falling 2.9 per cent to $44.27 and Rio Tinto 2.4 per cent to $139.94. Fortescue slipped 1 per cent to $22.74 as it agreed to acquire the remaining 64 per cent of Canadian-listed Alta Copper it does not already own at $C1.40 per share.
Even gold miners were sold off, despite the precious metal trading at $US4310 an ounce after adding more than 2 per cent last week. Evolution Mining, which has more than doubled this year, dropped 3.8 per cent to $12.28, while Northern Star was off 2.1 per cent to $26.77.
Lithium stocks were also weaker, with PLS tumbling 3.9 per cent to $3.94 and Liontown Resources down 6.4 per cent to $1.39.
Elsewhere, the major banks were mixed, with Commonwealth Bank off 0.6 per cent to $155.08 and ANZ up 1.2 per cent to $36.24.
Consumer discretionary was the sole sector to trade higher, led by a 2.3 per cent rally in JB Hi-Fi to $93.95. The rest of the industry group posted more modest gains, with Wesfarmers up 0.8 per cent and Harvey Norman 0.9 per cent.
Stocks in focus
In company news, ASX Ltd dropped 5.7 per cent to $53.66 after the market operator agreed to governance reforms arising from an ASIC report, which stipulated it must hold an additional $150 million in capital until agreed milestones are met. ASX will also cut its dividend payout ratio to 75 to 85 per cent.
Westgold Resources fell 2.8 per cent to $5.93 amid the broad mining sell-off. The miner has received approval to demerge its non-core Reedy and Comet gold assets into a new ASX-listed company, Valiant Gold, with an initial public offering planned for the March quarter.
Tyro Payments rose 1.5 per cent to $1.02 on news it will acquire Thriday, an artificial intelligence-powered financial management platform for SMEs.
4D Medical rose 9.9 per cent to $2.44 after the company received regulatory approval for its CT:VQ software scanning technology, which can now be deployed across Canada via its partnership with Philips.
DroneShield was the market leader, soaring 10.6 per cent and continuing a seesaw run that has seen it jump 18 per cent in the past five days to reduce losses in the past month to 12 per cent.
And Treasury Wines requested a trading halt on Monday after the Penfolds owner said it was in the final stage of preparing an update on the “company’s outlook”. It already had an investor and analyst call scheduled for Wednesday.
With Bloomberg
