Tabcorp fell 2 per cent amid news the wagering company has settled legal proceedings by its former chief executive Adam Rytenskild for an undisclosed sum over his sacking last year.
The lifters
Tech stocks were the only green island on the ASX on Thursday.
The technology sector rose 0.2 per cent as software maker Xero rose 0.6 per cent, data centre operator NextDC added 1.4 per cent and family member location app Life360 also gained 1.4 per cent.
Wesfarmers, the owner of Officeworks, Bunnings and Kmart, held up flat even as Kmart made headlines for breaching customers’ privacy by scanning shoppers’ faces without consent to combat fraud.
The lowdown
The local bourse opened lower on Thursday, as the Fed’s outlook for interest rates in the world’s largest economy failed to spark enthusiasm on Wall Street.
US stocks initially rose and bond yields fell after officials at the US central bank indicated they may cut rates several more times by the end of 2026. But they snapped back after Fed chair Jerome Powell warned not to take the projections as gospel.
The S&P 500 finished down 0.1 per cent and hung near its record set at the start of the week. The Dow Jones rose 260 points, or 0.6 per cent, while the Nasdaq composite fell 0.3 per cent.
Local employment figures weren’t able to improve the mood on the ASX as the session progressed. The Australian Bureau of Statistics reported that despite the jobless rate remaining steady at 4.2 per cent last month, the total number of people in work fell by 5000. Full-time employment dropped by a large 41,000, offset by a 36,000 increase in part-time work.
Concerns about rising unemployment have weighed on the market recently amid a series of job cuts by some of Australia’s biggest banks, including ANZ, NAB and Bendigo Bank.
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“Although today’s employment number was weaker than expected, it is not likely weak enough to force the RBA’s hand into a rate cut at this month’s policy meeting,” Betashares chief economist David Bassanese wrote in a note to clients.
Ryan Felsman, chief economist at CommSec, concurred, finding that “the mixed employment report failed to move the dial on the monetary policy outlook as investors upheld bets that the RBA would likely skip a move in interest rates later this month”, with most expecting a rate cut in November.
Wall Street’s moves overnight came after the Fed cut its main interest rate for the first time of the year, as investors had been widely expecting. What was more important to the market were the projections that Fed officials published showing they expect more cuts to be likely this year and next.
They indicated the typical member expects the federal funds rate to fall to a range of 3.25 per cent to 3.50 per cent by the end of next year, down from the current range of 4 per cent to 4.25 per cent.
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Stocks have already run to records on the assumption that easier interest rates are on the way. If Fed officials had indicated several more cuts were unlikely, the disappointment could have sent stock prices skidding.
Easier interest rates can give a kickstart to the economy, and the US job market is showing signs that it needs help. Hiring recently has been weak enough to indicate the job market may the bigger problem for the world’s largest economy than the threat of higher inflation.
The Fed is in charge of setting interest rates to influence both inflation and the US job market, and it had been keeping rates on hold so far this year because it’s been worried about how much President Donald Trump’s tariffs will raise prices for all kinds of products.
Drops for a handful of influential Big Tech stocks weighed on indexes. Nvidia fell 2.7 per cent, and Broadcom sank 3.8 per cent. They earlier had been helping to carry Wall Street to records amid the frenzy about artificial-intelligence technology, almost regardless of what rates were doing.
In other international markets, indexes were mixed across Europe and Asia.
With AP
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