Weakness in resource stocks dragged the share market lower for the first time in five days on the last full trading session before the Christmas break.
At lunchtime the ASX 200 was 38 points or 0.7% lower at 5404 and on track to break a winning streak that saw the index put on 290 points in four sessions since last Tuesday's two-month low. Overnight falls in oil, gold, iron ore and most base metals weighed on resource stocks, with the the gold sector losing 3.8%, metals & mining 2.6%, energy 2% and materials 2%. The only sector to advance was health +0.1%.
“We are seeing a bit of pessimism in the key commodities that have led the recovery in recent days,” Stan Shamu, markets strategist at IG, told Bloomberg. "Iron ore, gold and crude oil all lost some ground and this will weigh on some of the materials and energy names.”
China's Shanghai Composite sagged 2.06% and Hong Kong's Hang Seng lost 0.04%. Japan's Nikkei was closed for a public holiday to celebrate the Emperor's birthday. Dow futures were recently up 13 points or less than 0.1%.
Crude oil futures bounced 34 cents this morning to US$55.72 a barrel. Spot gold recovered $5.40 to US$1,178.60 an ounce. The dollar was buying 81.33 US cents.
Strong sense this morning that the market is winding down for the holidays. Volumes are weak, even among the heavyweights. My expectations for this time of year are always modest - if I can jag two profitable trades each day I reckon I've done all right. WHC gave a good entry opportunity, although I only caught a part-fill and took profits too early. Had another go at TSE near this morning's low and settled for a couple of pips when the bounce faltered. Subsistence stuff.
