Stocks inch lower in choppy trade

The local bourse had edged lower in choppy trade, with investors mulling fresh jobs data as mining stocks weighed heavy.

Pedestrians are reflected against an electronic board displaying stock information inside the Australian Securities Exchange. (David Moir/Bloomberg)

Local stocks fell on Thursday in choppy trade as investors mulled fresh economic data blowing a tailwind for the dollar against a heavy drag in the materials sector.

At the close, the benchmark S&P/ASX200 index was down 0.1 per cent or 5.6 points to 5738.7. The All Ordinaries was also down 0.1 per cent or 5.6 points to 5798.4.

The market sold down on the back of August jobs figures, however the 54,200 jobs added throughout the month provided some upside according to CMC chief market strategist Michael McCarthy.

“We certainly saw pressure on the market and it’s pretty clear that investors quickly put together the idea that increasing jobs means that we’ll see higher interest rates sooner and they sold shares down on the back of it,” said Mr. McCarthy.

“[However] if we’re seeing record levels of job creating, it suggests the economy is a lot hotter than the share market thinks. If we keep seeing these sorts of numbers, its likely it will be a positive for shares.”

Investors sought shelter in big bank shares, ANZ rose 0.5 per cent to $30.19, NAB added 0.75 per cent to $30.94, Westpac closed 0.32 per cent higher on $31.82 while CBA shares jumped 0.26 per cent to $76.75.

A year-to-date bull-run in base metals showed signs of unwinding, as copper, zinc and aluminum all lost ground and nickel plunged over 5 per cent. ANZ senior economist Giulia Lavinia Specchia said signs of softening demand spurred commodity traders into taking profits.

“Inventories of copper on the LME fell for a second consecutive day ... stockpiles are now up 18pc this week to 246,575 tonnes,” said Ms. Specchia.

“Investor positioning sits at record high net long position on the LME in recent days. This was enough to induce some investors to lock in their recent gains.”

Diversified mining stocks shed value despite an uptick in crude oil. BHP Billiton dropped 1.8 per cent to $26.89, Rio Tinto fell 1.7 per cent to $68.38, while energy heavyweight Woodside Petroleum rose 0.8 per cent to $28.54.

Retail investors were served a mixed bag by department store Myer, shares jumped 1.4 per cent after the department store revealed a sharp drop on full-year profit and slashed its dividend by a third.

“If the market judgment on this Myer result was a positive one, we’d be seeing a much higher Myer share price,” said Mr. McCarthy.

“It does look like some investors sold into this event and given the result they might be buying back today.”

South32 shares clawed back losses to close just 0.9 per cent after the company affirmed its support of carbon pricing, while gold miners and healthcare stocks littered the list of worst performers on the top 200 index with falls over 2 per cent.

Meanwhile, the Australian dollar pared early gains on the jobs figures amid signs of easing China industrial activity. In late trade, the local currency was 0.1 per cent, or US0.12 cents lower at US79.97 cents.