Australia: Tech stocks, a2 Milk drag shares lower ahead of US inflation data

AUSTRALIAN shares fell on Wednesday, dragged down by losses in technology stocks ahead of the US inflation data and a2 Milk after the US Food and Drug Administration deferred its request to import infant milk formula products into the United States.

The S&P/ASX 200 index fell 0.4 per cent to 6,998.60 by 0031 GMT, with most sub-indexes down. The benchmark index closed 0.1 per cent higher on Tuesday.

In other key markets, Japan’s Nikkei fell 0.8 per cent to 27,771.29 and S&P 500 E-minis futures edged 0.1 per cent lower.

Investors closely eyed July US consumer prices report that is expected to provide clues on any further aggressive interest rate hikes by the Federal Reserve.

In Australia and New Zealand, dairy producer a2 Milk was the top loser on both the benchmarks, slipping 7.2 per cent and 6.9 per cent, respectively.

Technology stocks tracked overnight losses in their Wall Street peers, slumping 3.6 per cent, with investment services provider Computershare and software maker Xero sliding 4.8 per cent and 4.4 per cent, respectively.

The sub-index was set to mark its worst session since June 14.

Miners dropped 0.2 per cent and were set to snap a three-session rally, as iron ore prices fell after fresh Covid-19 flare-ups in China and weak steel demand.

Fortescue Metals declined 0.2 per cent, while Rio Tinto added 0.4 per cent.

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Rival BHP Group was flat. Financials inched 0.1 per cent lower.

Commonwealth Bank of Australia retreated 0.7 per cent even as the country’s biggest lender posted its highest annual cash earnings in four years.

The other three of the “Big Four” banks fell between 0.4 per cent and 1.4 per cent.

Among individual stocks, GrainCorp jumped 7.4 per cent as the agribusiness firm raised its annual profit forecast for the second time.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.4 per cent to 11,703.40. REUTERS