Economy 2 MIN READ

Australia shares slide as U.S. inflation data fuels slowdown woes

May 12, 2022By Reuters

Australian shares slipped on Thursday, in line with global markets, after U.S. data showed higher-than-expected core inflation, fuelling worries about aggressive rate hikes and the prospect of an economic slowdown.

The S&P/ASX 200 index .AXJO was down 0.8% at 7,008.30, as of 0043 GMT. The benchmark closed 0.2% higher on Wednesday.

U.S. inflation data did little to ease investor worries over the outlook for interest rates and the economy. The monthly consumer price index data suggested inflation may have peaked in April but is likely to stay strong enough. nL2N2X22AO

In Asia, Japan’s Nikkei .N225 slumped 1.32% and S&P 500 E-minis futures EScv1 edged up 0.31%.

In Australia, financial stocks .AXFJ slipped 0.5% to mark their sixth consecutive loss.

The country’s biggest bank Commonwealth Bank of Australia CBA.AX fell 0.7% despite beating an estimate for third-quarter cash earnings. nL3N2X33YY

The remaining three of the “Big Four” banks fell between 0.1% and 1%.

Technology stocks .AXIJ dived as much as 7.4% to their lowest in two years after tracking a sharp overnight fall in the tech-heavy Nasdaq index. They were the top percentage losers in the benchmark. .N

ASX-listed shares of Block Inc SQ2.AX and Xero Ltd XRO.AX fell 15.7% and 8%, respectively.

Domestic gold stocks .AXGD fell 1.1% even as bullion prices bounced back. GOL/

Healthcare stocks .AXHJ fell 1.8% with heavyweight CSL Ltd CSL.AX losing 2.2% after the company said regulatory process for completion of Vifor Pharma acquisition would get delayed beyond June.

Energy stocks .AXEJ rose 0.6% as crude prices advanced after Russia sanctioned some European gas companies, adding to uncertainty in global oil markets. O/R

Viva Energy VEA.AX rose 4.5% and was among the top gainers in the benchmark index after the oil refiner posted a 65% jump in operating earnings for the first four months of the year. nL3N2X34DM

Miners .AXMM edged up 0.1% on strong iron ore prices. IRONORE/

New Zealand’s benchmark S&P/NZX 50 index .NZ50 fell 0.5% to 11,180.71.

(Reporting by Himanshi Akhand in Bengaluru; Editing by Sherry Jacob-Phillips)


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