Despite this, the S&P/ASX 200 index finished 14.8 points higher at 7865.5. However, the day’s performance was largely impacted by setbacks in the utilities sector, with Origin Energy, the 32nd largest company on the ASX taking heavy losses.
Origin Energy experienced share price declines after a surge in annual electricity profits of $1.1 billion. While this profit increase was down to higher wholesale energy costs, the company’s share price fell by 9.4 per cent. The shares’ final value on the day was $9.60. The utilities sector suffered overall, with Origin’s troubles dragging down other stocks. For example, the APA Group made a loss of 0.13 per cent.
Cochlear also contributed to the market’s losses on the day. The medical device manufacturer fell short of market expectations falling to $313. This was a loss of 7 per cent. According to the company’s CEO, the market had previously been too optimistic about the stock.
Meanwhile, the resources sector struggled over concerns about a slowdown in China’s steel production. The world’s largest steelmaker, Baowu, issued a warning about a prolonged downturn in the property sector, adding to fears of a “long and harsh winter.” Iron ore futures also took a hit, falling for the fourth consecutive day.
Major Australian mining companies experienced losses, with BHP down by 9 per cent over the past year and Fortescue down 16 per cent. However, Rio Tinto’s stock has risen nearly 5 per cent in the last 12 months, boosted by its joint venture with Baowu to build a mine in the Pilbara.
The telecommunications sector showed more resilience. For example, Telstra saw its share price rise by 2 per cent. This increase to it to a six-month high, despite reporting a 12 per cent drop in yearly profit. The company saw a boost in its customer base, with 560,000 new customers signing up for mobile plans. This boost contributed to a 1 per cent increase in revenue and a 3.7 per cent rise in underlying earnings.
In other good news, Car Group’s annual results were well-received by the market, with shares gaining 2 per cent. The company reported double-digit growth in both revenue and earnings, driven by strong performances in its Brazilian and US markets, as well as a healthy Australian used car market.
Looking to global markets, US inflation figures for July revealed a drop to below 3 per cent, the first time since 2021, boosting investor confidence. This trend raised hopes that the Federal Reserve might reduce interest rates in September. However, all eyes are now on the upcoming US retail sales numbers, as any negative data could signal a potential recession.
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