Stocks halt winning streak

The local market has ended its longest run of consecutive gains for the year, as buyer fatigue set in.

The Australian sharemarket has seen its eight-session winning run come to an end, as growing speculation of an August rate cut failed to offset weakness in the materials sector.

At the closing bell, the benchmark S&P/ASX 200 index had dipped 7.2 points, or 0.13 per cent, to 5,451.3, while the broader All Ordinaries index edged down 5 points, or 0.09 per cent, to 5,533.9.

The moves dragged the market away from an 11-month peak as buyer fatigue set in after the longest winning run for the year.

The key focus through the session was the release of the Reserve Bank’s July board meeting minutes, which confirmed the upcoming August meeting was ‘live’ for a potential rate cut.

CMC Markets chief market analyst Ric Spooner said the news failed to draw major stock buying interest, with the largest moves left to forex markets.

“While the Aussie dollar was down after the release of the minutes, the stock market struggled to get enthusiastic,” he said.

“This reflects a degree of caution as traders assess the odds of further gains after eight consecutive increases in the ASX 200 index.”

The primary winner out of the day’s trade was utilities, who are seen to benefit from falling rates as it drives interest in their steady dividends.

At the end of the session the utilities subsector of the market traded up 1.7 per cent, comfortably outperforming all other industries.

Among the bigger names AGL Energy jumped 2.1 per cent to $20.51 and Origin Energy rose 0.69 per cent to $5.87.

Meanwhile, Rio Tinto’s lacklustre quarterly production report and softer commodity prices drove a 1.8 per cent sell-off in the materials sector.

Rio led the losses with a fall of 2.3 per cent to $48.99, while BHP lost 1.9 per cent to $19.83 and Fortescue slid 1.5 per cent to $4.06.

In finance, the big banks ended around the flatline, with the exception being a 0.9 per cent slide in Westpac stock.

The energy sector outstripped the broader market as a sentiment boost from recent M&A moves offset weaker crude prices.

Woodside gained 1.3 per cent to $27.20, while Santos climbed 0.62 per cent to $4.88 and Oil Search rose 1.4 per cent to $7.35.

The retail sector also put in a strong showing, with a second day of outperformance amid hopes a rate cut could lift consumer confidence. Woolworths lifted 1.1 per cent, Wesfarmers tacked on 0.5 per cent and JB Hi-Fi jumped 2.1 per cent.

Meanwhile, Telstra ended steady at $5.78, while Qantas inched down 0.32 per cent to $3.08.

The Australian dollar ended the local session at US75.11c, losing half a cent through the day’s trade as rate hike expectations rose.

The market is now pricing in a 56.9 per cent chance of a rate cut next month, as opposed to a 53.7 per cent chance ahead of the RBA minutes.