Australian stocks set for another losing session

The sharemarket opened lower as commodity prices retreated after Fed talk pushed the greenback higher.

The sharemarket was facing a tough day.

The Australian sharemarket is on track for a third red session in as many days, as commodity prices retreat after hawkish rhetoric from the Fed pushed the US dollar higher.

At the opening bell, the benchmark S & P/ASX 200 index slid 21.2 points, or 0.38 per cent, to 5,494.3, while the broader All Ordinaries index gave back 19.6 points, or 0.35 per cent, to 5,587.3.

IG market analyst Angus Nicholson said Federal Reserve chair Janet Yellen had not been too forthcoming on Friday on the likely timing of rate hikes, but the central bank’s leaders had said enough to suggest moves could be afoot this year.

“The general takeaway is that a September rate hike is still unlikely, but the Fed would like to see the markets fully pricing in a December rate hike so it can come to pass with minimal fanfare. The US dollar initially sold off on Yellen’s comments and it was not until Stanley Fischer reiterated his hawkish comments that the US dollar really began to move higher,” he said.

“The ASX looks like it may have a tough day as materials and energy stocks will struggle in the stronger US dollar environment.”

Resources stocks were trending lower in morning action, with the notable exception of BHP, which inched up 0.1 per cent to $20.90.

Its key local rivals Rio Tinto and Fortescue — which rely more heavily on iron ore — were both off 0.6 per cent after ore prices skidded below $US60 a tonne over the weekend.

In energy, Santos slid 0.9 per cent to $4.44 and Woodside slumped 2.8 per cent to $28.84.

In finance, the big banks received short shrift for a third straight session, with ANZ softening 0.5 per cent, Commonwealth Bank losing 0.4 per cent, NAB retreating 1 per cent and Westpac backtracking 0.8 per cent.

Earnings season began to tail off, although there was a smattering of announcements to keep investors interested.

Perhaps the most high-profile was aged care group Estia, which nosedived 12 per cent after falling short of forecasts.

Elsewhere, Cardno edged up 0.7 per cent despite recording another loss and announcing the departure of its CEO, gold miner Regis Resources slipped 1 per cent despite reporting a jump in earnings and Beach Energy gained 1.8 per cent despite booking another heavy loss.

Among blue chips, Telstra dipped 0.2 per cent to $5.29, while Qantas weakened 1 per cent to $3.315.

Meanwhile, the Australian dollar was struggling to regain momentum and recently traded at US75.4c, almost US1c below where it stood on Friday afternoon.