The laggards
Mining was the weakest sector, with mining heavyweights BHP falling by 2 per cent, Fortescue falling 1.8 per cent, and Rio Tinto dropping by 0.8 per cent, while lithium miner Pilbara Minerals lost 1.2 per cent.
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Meanwhile, Woodside shares fell 1.9 per cent after news that the Australian oil and gas producer delayed investment decisions on two clean energy projects in the US โ one in low-carbon hydrogen and one in concentrated solar. Australian oil and gas producer Santos recovered early losses of 0.4 per cent to trade flat at the close.
The lowdown
As investors absorb the ramifications of Trumpโs return to the White House, the new US presidentโs comment that he was considering 10 per cent tariffs on imports from China hit ASX-listed miners. China is the biggest export market for Australian minerals, and there are concerns a trade war could further slow Chinaโs growth.
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Nick Twidale, chief market analyst at ATFX Australia said he expected Australian miners to be โunder pressureโ until there was further clarity on how Trumpโs proposed tariffs may affect China and Australiaโs mining sector.
โObviously there will be a direct proportional relationship between mining stock and how hard he [Trump] goes on tariffs, as well as how quickly he goes on tariffs,โ Twidale said.
โI think everything is conditional on what clarity and certainty we get from the US … if he hits China hard with tariffs, I think Australian industry and the Australian dollar will take a bit of a hit.โ
Similarly, Twidale said sharp increases in the tech sector was linked to Trumpโs announcement of the AI joint venture to strengthen the fast-growing technology.
โThrowing $US500 billion at AI infrastructure is great, and thatโs obviously going to boost tech stocks, not just in the US, but across the globe,โ he said.
Quote of the day
โWeโre talking about a tariff of 10 per cent on China, based on the fact that theyโre sending fentanyl to Mexico and Canada. Other countries are big abusers also, you know itโs not just China. We have a $350 billion deficit with the European Union. They treat us very very badly, so theyโre going to be in for tariffs.โ
US President Donald Trump on imposing a 10 per cent tariff on imports of Chinese-made goods, which could happen as soon as February 1.
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Australian energy giant Woodside has paused two major clean energy projects it had been pursuing in the United States, in the latest sign of fossil fuel companies taking a step back from economically challenging green investments.
The move by Perth-based Woodside, the nationโs largest oil and gas producer, comes as US President Donald Trump returned to the White House this week and signed a slew of orders aimed at promoting traditional fossil fuels and removing support for renewable energy and other clean technologies.
With AP, Bloomberg
The Market Recap newsletter is a wrap of the dayโs trading. Get it each weekday afternoon.
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