NAB, CBA dragging Aussie shares modestly lower at noon

[Pelican Press 0]

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NAB, CBA dragging Aussie shares modestly lower at noon

The local share market is on track for its third day of losses, dragged by two of the big four banks after disappointing first-quarter earnings from NAB.

Shortly after noon on Wednesday the benchmark S&P/ASX200 index was 28.5 points lower at 8,452.5, a drop of 0.34 per cent, while the broader All Ordinaries had fallen 24 points, or 0.27 per cent, to 8,732.7.

The modest losses come even after the S&P500 hit a new record high on Wall Street.

Across the Ditch, the Reserve Bank of New Zealand on Wednesday slashed interest rates by half a percentage point, to 3.75 per cent, as expected.

At midday, six of the ASX’s 11 sectors were higher and five were lower.

Financials was the biggest mover, dropping 1.4 per cent as NAB fell 5.8 per cent to $37.22 after announcing its first-quarter cash earnings had dropped two per cent to $1.74 billion.

Saxo Asia Pacific senior sales trader Junvum Kim said that NAB had navigated a challenging first quarter, with pressure from tighter margins and higher credit impairments.

CBA was down 1.8 per cent to $159.74, with the drop from two big banks accounting for all of the ASX’s losses at midday.

ANZ had dropped 0.8 per cent while Westpac was basically flat – although its shares are down 6.9 per cent so far this week after releasing its first-quarter earnings statement on Monday.

In the energy sector, Santos was down 3.1 per cent to $6.68 after the oil and gas producer announced a sharply lower dividend while reassuring investors that its Barossa gas project was on track to begin production in the third quarter.

In the heavyweight mining sector, goldminers were higher as the precious metal changed hands at $US2,938 an ounce, just under its all-time high set last week.

Northern Star was up 1.3 per cent, Newmont had addded 1.4 per cent and Evolution had gained 1.5 per cent.

Tom Stevenson, investment director at Fidelity International, said gold was on the rise because of its perceived safe-haven qualities at a time when the world looks uncertain.

“The election of Donald Trump has massively increased the unpredictability of US policy, on many fronts but notably on trade and tariffs,” he said.

Elsewhere in the sector, BHP was up 0.3 per cent, Fortescue had gained 0.6 per cent and Rio Tinto had advanced 0.9 per cent.

The *********** dollar was buying 63.44 US cents, from 63.42 US cents at 5pm on Tuesday.

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