The share market unwound much of its gains for the week as the dollar and resource stocks followed crude oil lower.
At 1pm EST the ASX 200 was 41 points or 0.7% weaker at 5750 and on track to finish around 20 points ahead for the week. The dollar was at 74.29 US cents this morning following its largest decline in three weeks. Traders dumped so-called 'commodity currencies' overnight after a sharp plunge on the price of crude as OPEC failed to meet elevated expectations for action to support oil prices. The Australian energy sector this morning lost 1.7%.
Crude, which had rallied hard into last night's OPEC meeting, slumped 4.8% overnight after the cartel extended current output curbs until next March but Saudi Arabia ruled out further cuts. West Texas Intermediate futures were lately off another four cents or 0.08% at US$48.86 a barrel.
"Oil was practically begging to be knocked off its perch after rallying into the OPEC meeting with wide expectations of extended cuts. As the extensions were estimated to be around nine to twelve months, OPEC needed to far exceed this time horizon for oil to sustain its rally," ThinkMarkets Senior Market Analyst Matt Simpson told CNBC.
The metals & mining sector shed 1.6% on overnight weakness in iron ore, materials 1.4% and telecoms 1.1%. Bucking the negative trend were gold and utilities, both up 0.2%.
In Asia, China's Shanghai Composite gained 0.14%, Hong Kong's Hang Seng was near flat at +0.03% and Japan's Nikkei off 0.26%. Dow futures were recently down 28 points or 0.13%. Gold futures improved $1.20 or 0.1% to US$1,261 an ounce.
And so the curtain draws nigh on a fairly directionless week on the market. The XJO huffed and puffed but ultimately failed to make a convincing break higher, while Wall Street breezed on to fresh record closes. Trading: API seems overdone when it might benefit from SIG's fallout with Chemist Warehouse. Broker downgrade? Took a small position with a view to Monday. Also a small start in PSY - where'd the volume go? ICG coming good from yesterday.
