The laggards

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Consumer staples (down 1.3 per cent) was the weakest sector on the local bourse, as Dan Murphy’s operator Endeavour Group (down 2.3 per cent) and Treasury Wine Estates (down 1.7 per cent) dropped.

Healthcare companies (down 1 per cent) also slipped as CSL shed 1.4 per cent, along with Resmed (down 0.4 per cent), Sonic Healthcare (down 1 per cent) and EBOS Group (down 1.8 per cent).

Westpac shed 3.1 per cent after releasing a trading update which said the bank’s core net interest margin – which compares funding costs with what the bank charges for loans – declined by 4 basis points, and that expenses had increased. All the big banks traded lower, as CBA slipped 0.6 per cent, NAB lost 0.4 per cent and ANZ fell 1 per cent.

Information technology companies (down 1.3 per cent) also slid lower as NEXTDC shed 0.9 per cent.

The lowdown

Australian Eagle Asset Management chief investment officer Sean Sequeira said the market was reconsidering some of its bearish outlook, after earnings results from some consumer discretionary companies showed consumers were holding up better than expected.

“The market is becoming more comfortable with certain aspects of retail demand,” he said. “Results from companies like Lovisa and Breville are showing the consumer is still active and only certain aspects of the housing market are feeling the pinch of higher interest rates.”

Despite strength from Cochlear, Sequeira said shares in the healthcare sector declined as majors CSL and Resmed dealt with rising costs.

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“There’s been a reassessment of the three main healthcare stocks in Australia,” he said. “Cochlear produced outstanding results last week, while Resmed underperformed this reporting period.”

Meanwhile, Wall Street limped to the finish line of its third losing week in a row.

The S&P 500 barely budged as it ended the week with a loss of more than 2 per cent, like other US indexes. It edged down less than 0.1 per cent. The Dow Jones added 0.1 per cent and the Nasdaq composite slipped 0.2 per cent.

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“There [are] a lot of things that are conducive to a daigou recovery. Unfortunately, we’re not seeing a significant rebound in that,” said A2 Milk chief executive David Bortolussi.

His company now has the once-highly lucrative daigou market of Chinese shoppers buying and exporting infant formula in its rearview mirror.

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With AP

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