Article / 16 December 2014 at 6:55 GMT

Australian Market Wrap: Commodities rout keeps all stocks in check

Trading Desk / Saxo Capital Markets
Australia
  • For the year to date, BHP has lost 27.82% of its value and Rio Tinto, 22.78%
  • Leading the market up was Qantas, which was oversold yesterday on the threat of a terrorist attack in Sydney
  • The AUD dipped briefly to US82c for the first time in four-and-a-half years, weighed down by oil and the Sydney siege

By Saxo Capital Markets Australia

Our local markets matched the performance of the US with our XJO sliding 33.78 points or 0.65% to 5152.30 led by the energy and materials sector. We are now sitting just above our October lows, down 3.74% for the year.

The energy sector was smashed today down by 2.08%: Woodside Energy dropped 93 cents or
2.63% to AUD34.46, Santos Ltd shed 2.55% or 19Untitled cents to AUD7.27 and Oil Search finished the day 2.75% down, losing 20 cents. Our materials was also a drag: BHP Billiton was sold down to AUD27.42, down 3.21%. For the year to date, BHP has been annihilated by 27.82%. Rio Tinto dropped 85 cents or 1.59% to AUD52.65 taking its year to date loss to 22.78%. Pure iron ore player Fortescue Metals closed 9 cents lower or 3.63% to AUD2.39.

Our banks were also weak but did not perform as bad as our commodity stocks: National Australia Bank managed to squeeze out a 2 cent gain to AUD31.50 followed by ANZ Bank who lost 2 cents to AUD30.74. Westpac Bank was the worst performer among the banks, losing 25 cents or 0.79% to AUD31.57 and Commonwealth Bank of Australia was 32 cents lower for the day or 0.39% to AUD80.95.

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 Everybody had a bad day including telecom giant Telstra. Photo: Thinkstock

In other blue chip stocks, Telstra Corporation shed 2 cents or 0.35% to AUD5.72 and CSL Limited was 31 cents lower for the day or 0.36% to AUD85.35.

Leading our market on a choppy day was our leading airline, Qantas (QAN). QAN was oversold yesterday on the threat of a terrorist attack in Sydney, rebounding today as expected once the market opened. After 9/11, airlines understandably are a questionable trade when an attack is taken out. QAN finished up 3.52% to AUD2.35.

Beach Petroleum (BPT) rallied today on the back of speculators looking for a breath on its fall. With oil continuing to fall, Beach remains a victim of its producing commodity and until this settles we can expect further uncertainty. BPT closed at 4:10pm up 2.25% to AUD0.91.

Treasury Wines (TWE) who have been going through a volatile time, today held their AGM. TWE was down a heavy 4.56% to AUD4.40 after their AGM failed to convince investors the restructuring of the company and divestment of some brands would bring value in the future.

The AUD dipped briefly to US82c for the first time in four-and-a-half years, weighed down by falling oil prices and a central bank that wants it even lower. At 4pm (AEDT), the local unit was trading at US82.23c, down from US82.49c yesterday.

-- Edited by Adam Courtenay

Australian Market Wrap is compiled by the Sydney trading desk at Saxo Capital Markets

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