ASX closes flat as investors shrug off Trump tariffs; Seven jumps, CSL slumps

Welcome to your five-minute recap of the trading day.

The numbers

The Australian sharemarket finished Tuesday’s session virtually unchanged after spending most of the day in the green amid hopes Australia may be exempted from President Donald Trump’s 25 per cent tariff on all steel and aluminium imports into the US.

The S&P/ASX 200 closed just 1.2 points, or 0.01 per cent, higher at 8484 points. Healthcare (down 2.9 per cent) acted as a major drag on the benchmark as biotech giant CSL slumped after its earnings were hit by Americans’ growing vaccine scepticism.

Donald Trump’s 25 per cent tariffs on steel and aluminium don’t seem to faze local investors amid hopes Australia could be exempted, again.Credit: nna\NPearson

The lifters

Utilities helped keep the bourse afloat as some investors switched into defensive stocks, while energy stocks benefited from a rise in oil prices overnight. Gold miners rallied after bullion hit a record high in the global search of safe haven investments. The Australian dollar slipped 0.1 per cent to 62.70 US cents.

Gold miners Northern Star, Newmont and Evolution Mining jumped 4 per cent, 3.2 per cent and 4.9 per cent respectively, as gold rose to a new all-time high after Trump flagged the new tariffs on the weekend, adding to increasing uncertainty in global financial markets.

“Gold remains in a sweet spot, with little standing in its way,” Westpac analyst Richard Franulovich said in a note. “An intrinsically unpredictable and disruptive Trump, hurtling tariff threats at allies and adversaries alike, alongside the threats of 100 per cent tariffs on the BRICs if they diversify away from the dollar, all point to a lift in gold’s safe-haven appeal.”

Utilities with their annuities-style earnings also appealed, with Origin finishing 0.8 per cent higher, APA Group rising 0.5 per cent and AGL Energy rising 0.2 per cent.

While Trump agreed to consider a tariff exemption on Australian steel and aluminium imports after a 40-minute telephone call with Prime Minister Anthony Albanese, the president nevertheless signed an executive order confirming the tariff regime will begin on March 12. The order makes clear Australia has not – at this stage – been exempted.

The market’s reaction was mixed. Bluescope Steel closed 0.5 per cent lower while Vulcan Steel climbed 5.2 per cent.

Kerry Stokes’ Seven West Media and its parent Seven Group Holdings both surged 6.1 per cent, after the media conglomerate said it saw an improved advertising market in the current quarter, and predicted “modest growth” in earnings for the June half from a year earlier, helped by the AFL and the federal election campaign. Its underlying profits were down 41 per cent at $37 million in the December half.

The laggards

Biotech heavyweight CSL weighed on the local market, with its shares closing down 5 per cent after the company said its earnings have taken a hit from lower vaccination rates in the US, where noted vaccine sceptic Robert F. Kennedy Jr closes in on the role of health secretary in the Trump administration.

Lithium miner Liontown Resources was at the bottom of the index, shedding 9.1 per cent, and Mineral Resources fell 6.9 per cent.

The lowdown

IG market analyst Tony Sycamore said nothing was set in stone when it comes to Trump. “Our steel and aluminium exports to the US are only modest. The more significant risk is the uncertainty the simmering trade war brings to markets,” he wrote in a note to clients.

Closer to home, the Westpac/Melbourne Institute’s consumer confidence indicator was unchanged from February – that is, still in slightly negative territory – and NAB’s business confidence index continues to show a downward trend, but is stabilising, according to AMP economist My Bui.

“Today’s surveys on both consumers and businesses show that the worst is probably behind for the Australian economy,” Bui said in a note.

“We don’t see these improvements in data as an impediment to a rate cut from the RBA next week, as inflation as well as GDP figures have been tracking lower than the Reserve Bank’s own forecasts; however, they might suggest a gradual approach to easing throughout 2025.”

The local market’s flat finish came after Wall Street seemed to take the looming tariffs in stride and kicked the new week off with a gain. Overnight in New York, the S&P 500 climbed 0.7 per cent to end at 6066.44 points, coming off a losing week that was book-ended by worries about how potential tariffs could push up inflation and threaten the world’s largest economy.

The Dow Jones added 0.4 per cent, and the Nasdaq composite was 1 per cent higher as Nvidia and other Big Tech stocks led the way.

US metals producers that would benefit from steel and aluminium tariffs rallied. Nucor, US Steel and Steel Dynamics rose more than 4 per cent each. Cleveland-Cliffs jumped 18 per cent, Century Aluminum rallied 10 per cent and Alcoa rose about 2 per cent.

Tweet of the day

Quote of the day

“She was a controversial broadcaster, and I think in relation to the Gaza-Israel conflict, she was an activist, that was quite apparent”.

That’s former ABC chair Ita Buttrose, who faced questioning during the ongoing Federal Court trial of the ABC’s unlawful termination of Antoinette Lattouf. Catch up on the latest from media writer Calum Jaspan here.

You may have missed

The financial regulator has launched another investigation into embattled superannuation giant Cbus over its expenses bill, including money spent on parties and picnics with the CFMEU.

The Australian Prudential Regulation Authority said on Tuesday it was concerned the board, chaired by former federal treasurer Wayne Swan, had not provided appropriate oversight of the fund’s management of risks.

AP, Bloomberg

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