Stocks end firmly in the red as Trump policy nerves weigh

The local market has closed firmly in the red, amid jitters over Trump’s policies and a swag of corporate updates.

Despite a healthy afternoon bounce the local index has now lost 1.6 per cent in the last two sessions. Picture: AAP/Dean Lewins.

Australian stocks lost further ground today, as local and global investors fret about the prospect of more jarring policy changes from Donald Trump’s new administration.

The benchmark S&P/ASX 200 closed 0.7 per cent weaker, at 5620 points, after dropping to within two points of a fresh six-week low. The broader All Ordinaries was down 39.3 points, or 0.69 per cent, at 5,675 points.

In a clear sign of market sensitivity, Donald Trump’s decision to fire Attorney-General Sally Yates saw a 0.3 drop in S&P500 futures, with the Australian market hitting its intraday low, down 1 per cent, on the news before recovering.

Despite a healthy afternoon bounce the local index has now lost 1.6 per cent in the last two sessions.

“While markets will be on alert given the amount of political noise currently being generated on trade policy and international relations, the reporting season remains the primary driver of valuations at the moment,” CMC Markets chief analyst Ric Spooner said.

“The US quarterly reporting season continues to support valuations while investors are now in ‘wait and see’ mode for the local half yearly reports due over coming weeks.”

Australian investors chewed on earnings numbers from Navitas and Beach Energy through the day, along production figures from Fortescue, Iluka and Origin Energy.

Among key movers Virtus Health tumbled 17.7 per cent, to $5.11, after it said slower markets and tough competition had contributed to a 7 per cent fall in new IVF business in the first half of the financial year.

Navitas dropped 6.1 per cent, to $4.43 as it reported a stronger half-year profit but a fall in revenue and earnings, and announced a lower dividend.

In the mining sector BHP Billiton dropped 2.63 per cent to $26.64, while Rio Tinto shed 1.7 per cent to $66.68. But iron ore miner Fortescue Metals put on 2.8 per cent to $6.66 after delivering another strong quarter of production and signalled a rise in dividends.

The big four banks also fell, with Westpac the worst performer as it weakened 0.94 per cent to $31.71. ANZ softened 0.88 per cent to $29.29, while NAB lost 0.69 per cent, $30.33 and Commonwealth Bank dropped 0.64 per cent to $81.66.

Meanwhile, spot gold breached the psychological threshold of $US1,200 per troy ounce during the session, amid rising safe-haven demand over concerns about US President Donald Trump’s policies. The Australian dollar was stronger at US75.64 cents at 4.30pm (AEDT), but moving in a narrow range.

Ahead, investors will be watching out for earnings results from Tabcorp, Downer EDI and GUD on Thursday, and James Hardie on Friday.