ASX 200 falls 1.1pc, hurt by banking, retail stocks; Baby Bunting tanks; Orica jumps; falls for CBA, JB Hi-Fi, Super Retail

The sharemarket has closed 1.1 per cent lower, with banking and retail stocks leading the losses. CBA records biggest fall in three weeks. Super Retail, JB Hi-Fi sales disappoint. Baby Bunting tanks. 

Bourse heavyweight CBA’s earnings update on investor radars. Picture: Gaye Gerard

Welcome to the Trading Day blog for Thursday, May 9.  The ASX 200 index closed 1.1 per cent lower at 7,721.6 points with broad falls, led by banking and retail stocks.

The Aussie dollar is near US65.73c.

Updates

4:34 pm May 9, 2024

ASX 200 retreats sharply after strong rise

David Rogers

Australia's share market unexpectedly retreats sharply, as most sectors fall after strong gains in recent days, albeit trading volumes are relatively light.

The S&P/ASX 200 ends down 1.1 per cent at 7721.7 after hitting a two-day low of 7715.2. It follows a 3.1 per cent rise in the past five days as interest rate jitters in the US and Australia receded after central bank meetings.

The index back below its 50-day moving average again after shying off 7800 points near the start of the "sell in May" period, even as corporate updates from the Macquarie Australia Conference haven't been too bad overall.

"Maybe the market is now ‘sobering up” to the fact that we have an inflation problem and rates are not going to be cut in 2024 in Australia," said Bell Potter head of institutional sales and trading, Richard Coppleson.

"If rates stay too high for too long then the economy will come under pressure & we know that the cyclicals will suffer, as will the banks."

CBA dives 2.2 per cent after its quarterly trading update even as analysts say the read through for its half-year earnings is slightly positive.

Westpac falls 5.6 per cent ex-dividend.

ANZ and NAB fall just over 1 per cent.

Wesfarmers dives 3.4 per cent amid cautious updates from other retailers.

JB Hi Fit falls 4.5 per cent, Temple & Webster falls 18 per cent, Super Retail falls 5.5 per cent and Baby Bunting drops 23 per cent after sales updates.

3:29 pm May 9, 2024

Westpac developing ACT public transport card tech

David Ross

Westpac will provide payment systems for the ACT's public transport ticketing system MyWay+.

The bank said it had won the bid to develop the Visa and Mastercard processing for debit and credit card transactions on the ACT's public transport network.

Westpac institutional bank chief executive Nell Hutton said Westapc's work on the MyWay+ development was "part of our continued commitment to offer innovative payments and transactional solutions to customers and support with their end-to-end banking needs".

2:49 pm May 9, 2024

Perpetual sale 'pretty good': Soul Patts boss

Bridget Carter

Soul Patts boss Todd Barlow says he believes the headline number for the sale of Perpetual ‘s corporate trust and wealth management units to Kohlberg Kravis Roberts of $2.18bn was “pretty good”.

But, he said he was yet to see the details of the proposal and the company would be keeping a close eye on it.

His comments came while speaking at the Macquarie Australia Conference in Sydney about the Australian conglomerate Soul Patts.

Mr Barlow said Soul Patts was well placed from a balance sheet perspective for mergers and acquisitions, and the company saw a great opportunity in bidding for Perpetual.

It was "a great Australian company" and Soul Patts had been interested in it for decades. In recent years, Soul Patts had seen that the performance of Australian asset managers had been weak and they had been undervalued, which was why it put forward a proposal.

2:47 pm May 9, 2024

ASX 20 set to snap five-day winning streak

David Rogers

Australia's share market is set to snap a five-day winning streak with a sharp and unexpected fall after a flat night on Wall Street.

The S&P/ASX 200 is down 1.1 per cent at 7719 points after emphatically rejecting the 7800 level in a move that erases all its post-RBA meeting rally.

"It's not lost on this observer that today's sell-off is the third time in two months that a rally above 7800 has been cut short by the emergence of an aggressive sell order that had a snowball effect on the local market," says IG market analyst Tony Sycamore.

"While we can't confirm if today's sell order is linked to the previous sell-offs in March and April, it does serve as a cautionary sign that today's decline could extend further."

2:25 pm May 9, 2024

ASX 200 down 1.1pc; testing 50-day average

David Rogers

Australia's share market remains under pressure as falls broaden.

The S&P/ASX 200 index falls 1.1 per cent to 7718.8.

Chart support from the April 24th high and the 50-day moving average at 7723-24 looks to be giving way.

Next potential support on the chart would be the 100-DMA at 7633.

Share trading volume remains light but the sustained fall is a concern.

2:03 pm May 9, 2024 Highlight

Calls for structural wine sector change

Anthony Keane

Structural changes are needed in Australia’s wine industry to combat a global oversupply of wine, but regional communities must be considered in the fallout, a business briefing has heard.

Hill-Smith Family Estates head of sustainability Louisa Rose told The Australian Competitive Advantage event in Adelaide that “we absolutely have an oversupply of grapes”.
“It’s not just in Australia,” she said.

“There’s a structural issue and we need to understand we are going to be affecting communities. “Think about communities on the Murray River in South Australia that are so reliant on the wine industry. Those communities in many cases are built around the wine industry.”

1:42 pm May 9, 2024

ASX 200 chart target now 7390: IG

David Rogers

IG market analyst Tony Sycamore reckons the ASX 200 has started a fall to 7390 points based his Elliot Wave count.

It comes as the S&P/ASX 200 unexpectedly falls 1 per cent to 7730.

"I think the third wave – Wave C – of a three-wave corrective ABC likely started today, which targets a move towards 7390," Mr Sycamore says.

"Confidence in this view builds should the ASX200 close below 7700."

His target is also close to the 200-day moving average, now at 7373.

1:40 pm May 9, 2024

Competitiveness means working together: Hill-Smith

Anthony Keane

Competitiveness requires businesses to work together, says Hill-Smith Family Estates winemaker and head of sustainability Louisa Rose.

She told The Australian Competitive Advantage boardroom series event that the wine industry’s success grew from wine businesses seeing each other as not just rivals. “What makes success?” she said. “Sometimes it’s just the way we behave. “We can be competitive sometimes by working together rather than competing all the time.”

1:09 pm May 9, 2024 Highlight

Air Vanuatu flights cancelled amid issues

Air Vanuatu has cancelled or adjusted dozens of flights to and from Australia, Noumea and New Zealand after reportedly being placed into voluntary administration.

This comes days after the collapse of Bonza airlines, with fears the move will have major ramifications on Queensland travellers.

Cancelled flights include services from Sydney to Port Vila from May 8 to 11 and from Auckland to Port Vila on the same dates.

On its website, the airline attributed the changes to "extended maintenance requirements on our aircraft," and said it was working with partner airlines to minimise disruptions.

Six flights between Sydney and Port Vila have been affected, with six other flights between Port Vila, Santo and Brisbane being cancelled. The Vanuatu Daily Post reported that the airline was placed into administration on 6 May, and that its board was "dissolved".

– Mohammad Alfares

1:05 pm May 9, 2024

Nuclear too expensive: Malinauskas

Anthony Keane

South Australian Premier Peter Malinauskas says his only opposition to nuclear power in his state is that it is too expensive to produce.

"The science of nuclear is clear," he told The Australian Competitive Advantage boardroom event in Adelaide. “It is safe, it is clean,” Mr Malinauskas said.

He also spoke of the importance of gas, saying SA’s rapid growth of renewable energy would not have happened without gas.

"Our commitment to gas in the medium term is substantial and material … All the people who are anti-gas aren’t going to cop any of this.

"If you have an ideological position, you are not interested in this. We just want to make sure we are appealing to everybody else who has an interest in facts."