Australian dollar strength weighs on dwindling sharemarket gains

The ASX closes marginally higher as Asia-Pacific currency strength ate into early appetite for equities across the region.

The ASX closes marginally higher as Asia-Pacific currency strength ate into early appetite for equities across the region.

The local share market finished the session slightly higher after losing early gains, as strength in currencies across the region cut into positive investor sentiment.

At the close of trade, the benchmark S&P/ASX200 was up 7 points or 0.1 per cent at 6077.1 points. The broader All Ordinaries index was up 10.9 points or 0.2 per cent, at 6187.7 points.

CMC Markets chief market strategist Michael McCarthy said it was a disappointing day for Australian investors.

“We charged out of the gates at the open this morning and that wasn’t surprising, we’d seen some good performances in the US and Europe on Friday night,” he said.

“But as the session has gone on gains have faded, it’s a similar story across the region and that does suggest that the macro factor that’s weighing on the markets in this region today is that weakening US dollar and the constant strength we’re seeing in the Yen but also locally in the Australian dollar.”

BHP gained 1.2 per cent to $31.90 while Rio Tinto grew 1.5 per cent to $81.80.

Meanwhile, the Australian dollar bought US79.54 cents in late trade, up 0.5 per cent for the session against a weaker greenback.

More to come.