ASX 200 LIVE: ASX advances; Japan's Nikkei rebounds; energy ...

Updated Aug 6, 2024 – 12.34pm, first published at 5.27am

Pinned post – 12.05PM

The Australian sharemarket is taking a breather after heavy selling, triggered by rising concerns that the US is heading towards a recession, washed across Europe and hit an already nervous Wall Street.

The benchmark S&P/ASX 200 Index rose 0.3 per cent, or by 20.3 points to 7668.3 as of 12.02pm AEST, with six out of the 11 sectors in the green. The index rebounded from earlier in the session when it was down 0.2 per cent near the start of trade.

Japanese equities powered higher from the open, retracing some of the losses sustained in yesterday’s global rout, which wiped out billions across markets from New York to London. US equity futures also advanced in early Asia trading.

“This morning’s S&P 500 market-on-close (MOC) orders suggest a less frenetic risk transition to Asia,” said SPI Asset Management’s Stephen Innes.

“It’s likely too early to sound the all-clear – markets still have plenty of risk to unpack, especially with recession talk lurking – but today’s robust US services data provided a glimmer of hope, reminding us that betting against the US consumer often ends as well as challenging Joey Chestnut to a hot dog-eating contest.”

That’s after the S&P/ASX 200 Index dived 293.6 points, or 3.7 per cent, to 7649.6 yesterday in the worst session for investors since COVID-19 riled markets in 2020. The drop occurred amid fears the US Federal Reserve has not cut rates quickly enough to avoid a hard economic landing.

In New York, the S&P 500 dropped 3 per cent to 5186.48, the tech-heavy Nasdaq sank 3.4 per cent and the Dow Jones shed 1033 points or 2.6 per cent. Wall Street’s “fear gauge” – the VIX – at one point registered its largest spike in data going back to 1990.

In commodities, copper, gold and crude oil tumbled as global economic malaise dimmed the outlook for industrial demand and sent traders rushing to cash out of profitable positions. On the ASX, energy stocks declined 1.8 per cent, led by Woodside tumbling 4.7 per cent.

Copper settled down 1.8 per cent on Monday (Tuesday AEST) in London after slumping as much as 3.8 per cent. Aluminium also fell. Oil rebounded slightly from a seven-month low as Brent climbed towards $US78 a barrel after tumbling more than 5 per cent over the previous three sessions.

Cryptocurrencies were also on the back foot. Bitcoin was 9.5 per cent lower to $US53,801 on bitstamp.net. It earlier briefly fell below $US50,000.

Local investors will also have their attention on the Reserve Bank’s policy decision at 2.30pm AEST, where the central bank is expected to keep interest rates on hold.

Coal miner Coronado Global Resources’ shares fell 0.4 per cent after it reported that its revenue slumped 10 per cent to $1342 million in the half-year due to lower average metallurgical coal prices. It reported a net income of $16.2 million and adjusted earnings before interest, taxes, depreciation and amortisation of $135.4 million.

Treasury Wine Estate rallied 1.7 per cent after it said it would shop around its cheaper wine brands as part of a strategic reset for the Penfolds owner.

Audiovisual networking business Audinate Group shares tumbled 35.9 per cent after the company provided a soft FY25 outlook which implied a large consensus downgrade. It was the worst performing ASX 200 stock.

With Bloomberg