The laggards

Toll road operator Atlas Arteria shed 5.1 per cent as it traded ex-dividend, while Mineral Resources (down 2.8 per cent), Lynas Rare Earths (down 3.3 per cent) and Pilbara Minerals (down 3.6 per cent) were sharply lower.

Seven Group shares were down 4.1 per cent, with the company criticising an independent expert’s report into its bid for Boral, which it claimed contained “fundamental errors”.

Tech (down 1.6 per cent) and communications companies (down 1 per cent) were the weakest sectors, with Xero (down 2.7 per cent), Seek (down 2.4 per cent) and REA Group (down 2.1 per cent) leading them lower.

The lowdown

IG Australia market analyst Tony Sycamore said while the Australian sharemarket slipped following losses on Wall Street overnight, the local bourse could hit a fresh all-time high this week amid investment funds’ end-of-month and end-of-quarter rebalancing flows likely to hit the market.

Sycamore noted a fall in the Westpac Consumer Confidence sentiment index, and said monthly consumer price index data for February, due to be released on Wednesday, would likely further inflame concerns around the economic outlook.

“It’s expected to rise by 3.6 per cent year-on-year, from 3.4 per cent, due to higher petrol and housing prices and the unwinding of electricity rebates,” he said.

Sycamore said major iron ore miners including Fortescue, BHP and Rio Tinto also dragged down the local index on Tuesday.

On Wall Street overnight, the S&P 500 slipped 0.3 per cent on a quiet day of trading. The Dow Jones fell 0.4 per cent and the Nasdaq composite dropped 0.3 per cent.

Loading

The US market tapped the brakes following its big run last week, which was its best of the year and sent all three indexes to records on Thursday. Stocks climbed as the Federal Reserve indicated it was still likely to deliver several cuts to interest rates this year, as long as inflation keeps cooling.

That has the S&P 500 on track for another winning month in what’s been a nearly unstoppable run since late October.

For the market to continue rallying, more companies will need to deliver strong earnings growth to justify high prices, strategists at Morgan Stanley say.

Bitcoin enthusiasts appear to be shrugging off last week’s outflows from US exchange-traded funds, with the largest cryptocurrency climbing back above $US70,000. It was 4.4 per cent higher at $US70,382 at 4.48pm (AEDT) on Bitstamp.

This week’s highlight for financial markets might be Friday’s report on US consumer spending. It will also include the latest update on the measure of inflation that the Federal Reserve prefers to use. But the US stock and bond markets will be closed that day for Good Friday.

The US bond market will also close early on Thursday, which could tighten trades before the report.

Despite a string of recent reports that showed inflation remaining hotter than expected, the Reserve seems to expect inflation to continue its longer-term cooling trend.

Traders largely expect the Reserve to begin cutting rates in June. That would offer relief for the economy because the Fed’s main rate has sat at its highest level since 2001 for nearly eight months.

High rates work to grind down inflation by slowing the entire economy and hurting prices for investments.

In the bond market, Treasury yields climbed. The 10-year yield rose to 4.24 per cent from 4.20 per cent late on Friday.

Indexes mostly moved modestly in mixed trading across Europe and Asia.

Tweet of the day

Quote of the day

“Three years is too short,” said Westpac chief executive Peter King about federal election cycles, backing calls to extend government terms to four years. He argues the move would help improve stability and certainty for businesses.

You may have missed

Crown Resorts will keep the licence to operate its flagship Melbourne casino, 18 months after the company was disgraced by two scathing royal commissions and a state inquiry that found it failed to curb money laundering and terrorism financing across its three casinos for years.

With AP

The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.