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The laggards
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Energy giants Yancoal (down 4 per cent) and Whitehaven Coal (down 2.2 per cent) were among the worst large-cap performers.
Santos shares slumped 4.4 per cent after the company reported an 18 per cent drop in first-half underlying profit, to $US654 million ($970 million) – below analysts’ forecasts – due to declining liquefied natural gas prices.
Shares in pizza delivery chain Domino’s fell early in the session after the company reported a 1.3 per cent dip in sales since the start of the current financial year. However, they regained a little ground in the afternoon to finish 1.4 per cent lower.
Commonwealth Bank shares slumped 2.6 per cent as investors took profits after their strong recent run. They are still up more than 19 per cent so far this year.
On Wall Street overnight, the S&P 500 Index fell 0.2 per cent, just 1.2 percentage points below its record high set last month. The Dow Jones Industrial Average slipped 0.2 per cent, and the Nasdaq Composite Index lost 0.3 per cent.
Nvidia was the heaviest weight on the market after falling 2.1 per cent. The chip company is one of Wall Street’s most influential stocks because a frenzy around artificial intelligence technology has made it one of the US stock market’s most valuable companies at roughly $US3 trillion ($4.5 trillion).
Nvidia has recovered most of its recent swoon, where its stock dropped more than 20 per cent on worries investors went overboard and took its price too high, but it has remained shaky as it heads into its earnings report scheduled for next week.
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Companies in the S&P 500 are on track to report their best growth in earnings per share since the end of 2021, according to FactSet.
High interest rates have been weighing on the economy after the Federal Reserve hiked them sharply to bring inflation under control. On Tuesday, Treasury yields were easing ahead of a speech on Friday by Federal Reserve Chair Jerome Powell, one that’s likely to be the week’s highlight for financial markets.
The economic symposium in Jackson Hole, Wyoming, where Powell will be speaking, has been home to big policy announcements in the past. Expectations aren’t that high this time around, with nearly everyone already expecting the Fed will begin cutting interest rates next month.
A surprisingly weak report on hiring by US employers last month raised worries the Fed has already kept interest rates too high for too long, but ensuing data on everything from inflation to sales at US retailers helped bolster optimism. The yield on the 10-year Treasury fell to 3.82 per cent, from 3.87 per cent late on Monday.
Quote of the day
“We provided 20,000 customers with financial support, invested heavily in our people, making sure we’re identifying as quickly as possible vulnerable customers.” That’s IAG chief executive Nick Hawkins, describing challenges in the community and business over the past couple of years.
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