Australia: Shares drop as financials drag on Federal Reserve rate-hike fears

AUSTRALIAN shares fell on Friday, dragged down by financial and real estate stocks, in line with overnight Wall Street losses after comments from a US Federal Reserve official reinforced expectations of aggressive interest rate hikes.

The S&P/ASX 200 index fell 0.7 per cent to 6,686.4, as of 0001 GMT. The index is down 1.1 per cent this week, set for its biggest weekly drop in four.

Wall street closed lower overnight despite solid earnings after data on the labour market, as comments from a Fed official bolstered concerns about aggressive rate hikes and potentially tilting the economy into a recession.

In Sydney, heavyweight financials fell 1.6 per cent, their biggest intraday loss since Sept 30, with the country’s “Big Four” banks falling between 1.3 per cent and 1.6 per cent.

Wealth manager AMP was up 0.2 per cent, after it reported that third-quarter net outflows at its Australian wealth management unit more than halved due to increased inflows into its flagship online investment platform, North, and reduced withdrawals at its pension trusts.

Insurance Australia Group fell over 2 per cent after it warned that the company received more than 2,000 claims from New South Wales, Victoria and Tasmania, following heavy floods in the region.

Broader mining and gold stocks inched up 0.1 per cent, each.

Lithium miner Allkem, however, fell 5.8 per cent, after its first-quarter revenue declined due to lower output from its Mt Cattlin operations.

The stock was the top loser on the ASX 200 and was set for its worst session in 3-1/2 weeks.

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Australia: Shares end lower as recession fears loom

Real estate stocks fell 1.2 per cent, while healthcare and energy stocks also traded in the red.

In New Zealand, the benchmark S&P/NZX 50 index was flat at 10,829.74.

The country posted a monthly trade deficit of NZ$1.615 billion (S$1.3 billion) in September, data from Statistics New Zealand showed, while the annual deficit was NZ$11.95 billion. REUTERS