ASX200 falls as investors wait for all-important Fed meeting

Australia’s sharemarket has finished in the red as investors wait to see if the US Federal Reserve will spur on the world’s largest economy.

The Australian sharemarket closed lower on Wednesday, snapping a three-day win streak as markets wait for an all-important Federal Reserve meeting.

The benchmark ASX200 index fell by 32.10 points or 0.41 per cent to close at 7,828.30 points.

The broader All Ordinaries also dropped down 34.60 points or 0.43 per cent to finish Wednesday at 8,055.30 points.

The Australian dollar is trading around 63.58 US cents.

In a broad market sell-off, eight of the 11 sectors finished in the red, with only healthcare, telecommunications services and energy having a positive day.

The fall in the ASX 200 ended the dead cat bounce on the market. Picture: NewsWire / Max Mason-Hubers

Australian investors were jittery with the index swinging between gains and losses throughout the day, as the market was looking towards deteriorating global growth.

A fall in iron ore price back to $US101.80 saw BHP drop 0.15 per cent to $39.56 while Rio Tinto slumped 0.69 per cent to $118.70 and Fortescue sank 1.02 per cent to $16.49.

The markets turned their attention to the US Federal Reserve monetary policy decision on Thursday morning (local time), as investors are looking for clues about the US tariff policy impact on growth and inflation.

Capital.com senior financial market analyst Kyle Rodda said the recent market was a bit of a dead cat bounce, with the market waiting for news out of the US.

“The perception for a while was that the US economy was quite resilient and that further rate cuts may not be required to support the economy overall,” Mr Rodda said.

“Obviously that has changed in the last six weeks, we are seeing a sign of a downturn now in the US economic growth with the market hoping that if the downturn starts to gather in pace the Fed is on standby and ready to lower rates.”

“It won’t be a cut tomorrow but the hope is with the language the Fed provides tells investors they are ready to cut rates if necessary.

Eight of the 11 sectors finished in the red. Picture: NewsWire / Max Mason-Hubers

Utilities, A-REITs and Industrials were among the major sectors sold off.

Origin Energy shares slumped 1.94 per cent to $10.60, while AGL Energy fell 2.04 per cent to $10.58.

The big banks also fell with CBA down 0.99 per cent to $142.77, Westpac slightly down 0.20 per cent to $30.12 and ANZ slid 0.55 per cent to $28.72. NAB was the only major bank to finish in the green up 0.18 per cent to $32.65.

In company news department store Myer shares dropped 1.3 per cent to $0.75 after the department store announced profit tumbled nearly 40 per cent in the first half of the financial year.

According to an announcement to the ASX net profit after tax came in at $30.4m. The company flagged a $14m cost associated with its merger with Premier Investments Apparel Brand Division and 2.5m for a strategic review.

The a2 Milk Company also slumped 2.5 per cent to $8.32 after Barrenjoey downgraded the stock to “neutral” after the stock bounced on the back of news of a Chinese stimulus package which intended to help boost birthrates.

Originally published as ASX200 falls as investors wait for all-important Fed meeting