ASX weekly: Global trade tensions impact local share market

Shares in the major banks rose for a second consecutive week, but it was not enough to lift the Australian share market as the global trade war dampened investor appetite.
Oil mining - ASX impacted by global trade tensions
Source: Vova Shevchuk (Shutterstock)

The benchmark S&P/ASX 200 closed 0.92% lower at 6,397 points last week, while the broader All Ordinaries index fell 0.81% to 6,492 points.

The energy sector took the biggest hit, dropping by about 6.5% last week, followed by falls across the information technology, consumer staples and utilities sectors.

Woolworths was a major drag for the consumer staples sector, with its $5.6 billion plus fall in market value leading market capitalisation losses last week.

This was despite an announcement from the supermarket giant that it had successfully completed its $1.7 billion off-market share buyback.

Reflecting energy sector losses, Woodside Petroleum shed more than $1.6 billion in market value due to weaker oil prices linked to ongoing global trade tensions.

Mining and petroleum giant BHP was also in the red, with its market value dropping by more than $2.2 billion.

Ongoing US-China trade tensions might actually be benefiting miner and producer of rare earth materials Lynas Corporation, which saw its share price skyrocket by 53% last week.

AMP Capital Chief Economist Shane Oliver said China supplies around 80% of US rare earth imports, which are used in electronics, electric vehicles and by defence industries such as the US military.

A number of media reports suggest China could reduce the supply of rare earths in the trade war with the US and this could increase the importance of Australian rare earths producer Lynas.

The Malaysian government also announced last week that it would allow Lynas to renew its license and continue to operate its plant there, despite fears the plant would be forced to shut down due to contamination concerns.

ASX 200 Listed Companies – Top 5 Biggest Share Price Gains and Losses (17/05/2019 to 31/05/2019)
Biggest Gains Biggest Losses
Rank Company Closing Share Price % Change Rank Company Closing Share Price % Change
1 Lynas Corporation (LYC) $3.06 53.0% 1 Link Administration Holdings (LNK) $5.93 -23.3%
2 NIB Holdings (NHF) $6.85 16.3% 2 Technology One (TNE) $7.16 -23.0%
3 CSR (CSR) $4.00 15.9% 3 Costa Group Holdings (CGC) $3.96 -21.0%
4 Boral (BLD) $5.43 15.7% 4 BlueScope Steel(BSL) $10.53 -18.5%
5 Eclipx Group (ECX) $1.13 15.4% 5 Nufarm (NUF) $3.93 -14.2%
Prepared by Canstar. Prices taken as of week to week close.

Australia’s four major banks – Commonwealth Bank, National Australia Bank, Westpac and ANZ – all topped market value gains last week, with the financials the best performing sector last week (up 5.42%).

Building products company CSR continued its share price climb from the prior week, up almost 16%, and building and construction company Boral rose 15.7%.

ASX 200 Listed Companies – Top 5 Biggest Market Cap Gains and Losses (17/05/2019 to 31/05/2019)
Biggest Gains Biggest Losses
Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price
1 Commonwealth Bank of Australia (CBA) $9,754,019,683 $78.34 7.6% 1 Woolworths Group (WOW) -$5,619,953,548 $31.31 -8.4%
2 National Australia Bank (NAB) $6,958,759,076 $26.40 10.3% 2 Fortescue Metals Group (FMG) -$2,801,858,075 $8.04 -10.2%
3 Westpac Banking Corporation (WBC) $6,895,142,046 $27.41 7.9% 3 BHP Group (BHP) -$2,283,034,830 $37.69 -2.0%
4 ANZ Banking Group (ANZ) $5,694,682,914 $27.86 7.8% 4 Woodside Petroleum (WPL) -$1,694,434,304 $35.39 -4.9%
5 Aristocrat Leisure (ALL) $1,293,051,903 $29.12 7.5% 5 QBE Insurance Group (QBE) -$1,417,969,415 $11.67 -8.4%
Prepared by Canstar. Prices taken as of week to week close.

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