The laggards

Meanwhile, Coles was the biggest large-cap decliner, shedding 7.1 per cent, after delivering net profit just below consensus estimates. The loss comes after the supermarket giant said it was hit by a wave of shoplifting as cost-of-living pressures increased. The consumer staples sector dropped 2.5 per cent, weighed down by Coles and its main competitor Woolworths (down 3 per cent).

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Energy companies (down 1.2 per cent) were also weaker. Santos fell 0.5 per cent and Woodside shed 1 per cent despite the latter reporting record profits.

Healthcare companies (down 0.9 per cent) also declined as Resmed lost 1.6 per cent, CSL dropped 1 per cent and Ramsay slipped 1.4 per cent.

Iron ore giant BHP dropped 0.7 per cent after reporting weaker-than-expected profit and slashed its dividend by almost half in face of falling commodity prices.

The lowdown

Shaw and Partners senior investment advisor Craig Sidney said the Australian sharemarket was relatively flat on Tuesday on the back of some weaker earnings results from some of the country’s major companies.

“BHP’s results were a little bit disappointing, so they’ve been sold down from yesterday’s levels,” he said, noting that oil heavyweight Woodside also declined.

Consumer staples were weighed down by results from Coles, Sidney said, as the supermarket giant showed its expenses seemed to be rising, taking the shine off stocks such as Woolworths.

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Meanwhile, Sidney said technology companies climbed on the back of a positive lead from the US, where chipmaker Nvidia helped lift the Nasdaq, as well as strong results from some domestic companies including Altium, which he said was a standout with results that exceeded expectations.

Wall Street held a bit firmer overnight following a painful three-week losing streak. The S&P 500 rose 0.7 per cent for its first gain in five days. Rallies for Nvidia, Microsoft and other Big Tech stocks lifted the index, even though most stocks within it fell.

The Dow Jones slipped 0.1 per cent and the Nasdaq composite climbed 1.6 per cent.

It was a return to form for Nvidia, Tesla and other market behemoths, which have struggled recently under the weight of rising yields in the bond market. The yield on the 10-year Treasury rose again on Monday to touch its highest level since 2007 after briefly climbing above 4.34 per cent.

Higher yields are good for people buying bonds, who get paid more in interest for their investments. But it also makes investors less willing to pay high prices for stocks and other investments that are less steady.

Powell at Jackson Hole

The week’s main economic event is likely to be a speech on Friday by Federal Reserve Chair Jerome Powell. The Jackson Hole, Wyoming, setting for his speech has been the site of major policy announcements in the past by the Fed, and it’s one of the most important events each year for central bankers globally.

The worry is that Powell will dash investors’ hopes that the Fed has hiked interest rates for the final time and that its next move will be to cut rates early next year.

In the minutes from its last policy meeting in July, the Fed indicated it was unsure about its next move. It said it will make upcoming decisions on rates based on what incoming data say about inflation and the economy.

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Nvidia soars

Another big event for the market will be Nvidia’s profit report scheduled for Wednesday. The chipmaker’s stock has flown higher this year, more than tripling on excitement about demand for artificial-intelligence technology.

Nvidia’s result may offer a hint about whether all the furor around AI-related stocks was deserved. It jumped 8.5 per cent on Monday. Microsoft, another AI winner, rose 1.7 per cent. They were two of the strongest forces lifting the S&P 500.

Along with them was Tesla, another high-growth stock hurt recently by the threat of higher rates. It rose 7.3 per cent to recover some of its 11 per cent loss from last week.

Tweet of the day

Quote of the day

“The decision to deny the application has been estimated to cost the tourism industry up to $788 million,” said Australian Chamber of Commerce and Industry executive chairman John Heart as he urged Transport Minister Catherine King to rethink the decision to reject Qatar’s application to double its flights to Australia.

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With AP

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