The Australian share market has surrendered all its gains for the year so far as investors pondered uncertainties around the travel and immigration policies of new US President Donald Trump and exercised caution ahead of company reporting season.
The benchmark index on the local bourse fell below 2016’s close of 5665.8 points and is now well below its spike in early January above 5,800 points, ending Monday down 0.9 per cent at 5661.5.
The big banks, major miners and energy stocks were weaker.
Many markets in Asia were shut for Lunar New Year holidays but those in Australia and Japan lost ground as investors considered the potential impacts of Mr Trump’s temporary ban on visitors from seven predominantly Muslim countries and the indefinite barring of Syrian refugees.
“Markets generally have had a slightly negative reaction to the news of the US immigration policy,” CMC Markets chief market analyst Ric Spooner said.
“It’s not something that directly affects markets as it stands to any great extent, but there’s a little bit of a caution-watch because it is something that could escalate potentially if there was to be retaliatory policies from other countries.”
Mr Spooner also said that Australian investors were in profit-taking mode generally and that had continued on Monday.
He said investors were likely waiting for the local company earnings season to get underway later this week.
All of the big banks were around 0.5 to one per cent lower.
In the resources sector, global miner BHP Billiton was off 0.58 per cent and Fortescue Metals had a sharper drop of 2.26 per cent.
Gold miner Newcrest jumped 27 cents to $21.45 after reaffirming its annual production guidance despite flat production in the December quarter.
Energy stocks were lower as oil prices eased following news that US oil drillers had increased the number of rigs.
In company news, insurer QBE firmed two cents to $12.35 amid takeover speculation despite the company saying it was not in talks with anyone.
Construction software firm Aconex’s plummeted $2.55, or 45.1 per cent, to $3.10 after the company issued a profit warning and caterer Spotless fell 5.1 per cent to 93 cents on news it faces a possible class action over its 2015 financial results.
Meanwhile, the Australian dollar is higher against the US dollar, as traders contemplate the possible impact of President Trump’s latest executive order.
The local currency was trading at 75.49 US cents at 1700 AEDT on Monday, from 75.26 cents on Friday.
ON THE ASX:
* On Monday, the benchmark S&P/ASX200 was down 52.5 points, or 0.92 per cent, at 5,661.5 points.
* The broader All Ordinaries index was down 51.3 points, or 0.89 per cent, at 5,714.3 points.
* The March SPI200 futures contract was down 58 points, or 1.02 per cent, at 5,603 points.
* National turnover was 2.6 billion securities traded worth $4.5 billion.
CURRENCY SNAPSHOT AT 1700 AEDT:
One Australian dollar buys:
* 75.49 US cents, down from 75.26 on Friday
* 86.503 Japanese yen, from 86.58
* 70.39 euro cents, from 70.54 cents
* 60.06. British pence, from 59.97 pence
* 104.02 New Zealand cents, from 103.82 NZ cents
GOLD:
The spot price of gold in Sydney at 1700 AEDT was $US1,192.70 per fine ounce, up $US9.50 from $US1,183.20 on Friday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 5.25 per cent March 2019, 1.8113pct, from 1.8439pct on Friday
* CGS 4.25pct April 2026, 2.6637pct, from 2.715pct
SYDNEY FUTURES EXCHANGE PRICES:
* March 2017 10-year bond futures contract at 97.24 (implying a yield of 2.76pct), up from 97.190 (2.810pct) on Friday
* March 2017 3-year bond futures contract at 98.03 (1.970pct), up from 98.00 (2.00pct)
(*Currency closes taken at 1700 AEDT previous local session, bond market closes taken at 1630 AEDT previous local session)
