ASX falls for 1.3 per cent in October

Australia’s sharemarket has ended the month of October down, as investors prepare for next week’s US Presidential election.

The benchmark ASX 200 index on Thursday declined by 20.40 points, or 0.25 per cent, to finish the session at 8,160 points.

The broader All Ordinaries fell by 17.40 points, or 0.21 per cent, to close at 8,422,10 points.

The Australian dollar fell 0.04 per cent to 65.70 US cents.

Only three of the 11 sectors finished the day in the green.

Australia’s market slipped following falls overnight on Wall Street, which saw the Dow Jones slip 0.2 per cent to 42,142 points, and the S&P 500 fell 0.3 per cent to 5,814.

The tech-heavy Nasdaq Composite lost 0.6 per cent to 18,608 points, retreating from yesterday’s record high, after Meta – the parent company of Facebook and Instagram – and Microsoft announced their company earnings.

Microsoft said its cloud business would get a boost from AI while Meta warned of significant acceleration in infrastructure spend due to the AI boom.

Following weakness out of the US, the ASX fell on Thursday, solidifying losses for the month.

The ASX 200 closed the month down 1.34 per cent in October, or 111.10 points to 8,158.70. Overall, markets are still up 6.96 per cent year-to-date or up 530.90 points.

IG commentator Tony Sycamore said traders had moved to the sidelines, ahead of next week which will shape the path for markets into year-end.

“Next week’s events include the US election and interest rate decisions from the RBA, Bank of England and (the US) Fed,” he said.

“Additionally, the upcoming National People’s Congress Standing Committee meeting is expected to unveil details of China’s fiscal stimulus package.”

In Australia, the Reserve Bank board will announce its latest rates decision, which is expected to keep the cash rate on hold at 4.35 per cent.

US weakness, less chance of near-term rate cuts after the CPI data and retail trading figures were released.

AMP economist My Bui said the RBA would likely see Thursday’s retail sales data as showing the worst for Australian retail was over, although the overall picture for households in Australia was still pretty fragile.

“Spending per person in the sector is still negative and is now down 1.9 per cent year over year,” she said.

“This means most households are probably still saving most of the stage 3 tax cuts and there’s still a constraint on households.

“We think the worst for Australian households have probably passed because of tax cuts, strong wages growth and a resilient labour market.”

Mineral Resources was the best performing ASX 200 share after the company reported it has agreed to sell its two oil and gas exploration permits in the Perth Basin to Gina Rinehart’s Hancock Prospecting. Shares closed up 9.92 per cent to close at $39.66 per share.

There were positive updates from JB Hi-Fi and Corporate Travel Management, following the announcement of quarterly results. JB Hi-Fi is now trading up 5.288 per cent to $82.03 while Corporate Travel Management rose 4.88 per cent to close at $12.37

Today’s weakness came off the back of the blue chip stocks in the major supermarkets which reported weaker than expected trading volumes.

Coles is off 0.90 per cent to $17.54 while Woolworths is trading lower 2.53 per cent to $30.03 backing following falls of 6 per cent the day prior.

The two major supermarkets have both announced cost of living pressures are weighing on their bottom line.