The Business Times

Australia: Tech stocks drag shares lower, despite energy boost

Published Tue, Jul 6, 2021 · 03:31 PM

[BENGALURU] Australian shares closed lower on Tuesday weighed down by tech stocks and as the country's central bank in a policy meeting decided to pare its bond buying programme.

The S&P/ASX 200 index reversed gains made in the morning trade to end 0.7 per cent lower at 7,261.8 points, it's lowest in a week.

The Reserve Bank of Australia in its July policy meeting on Tuesday held the cash rate at 0.1 per cent, as widely expected, and highlighted ongoing virus outbreaks as a key near-term uncertainty.

"It's inflation on trade today, with the rising oil prices threatening recovery. The US Federal Reserve may be forced to raise rates, which is very concerning," Brad Smoling of Smoling Stockbroking said.

However, the jump in oil prices boosted Australia's energy sub-index which rallied to 1.6 per cent, after hitting a near three-week high during Tuesday's session.

Oil Search closed up 4.62 per cent, which was also the biggest gainer on the benchmark, followed by Australia's largest independent coal miner Whitehaven Coal at 3.9 per cent.

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Ministers of the Organization of the Petroleum Exporting Countries and its allies, a group known as Opec+, called off oil output talks, raising concerns that supplies will tighten further.

The tech stocks fell 1.8 per cent, weighing on the benchmark, led by Appen, down 6.2 per cent, and Megaport, losing 3.5 per cent.

Further souring sentiments were the big four banks, down between 0.2 per cent and 0.6 per cent, while the financial sub-index fell 0.42 per cent.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.4 per cent to 12,758.9.

REUTERS

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