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Markets

Australian shares close lower on mining, tech losses

  • New Zealand's benchmark S&P/NZX 50 index fell 0.9% as weaker financial and healthcare sectors weighed.
24 Feb 2021

Australian shares closed lower on Wednesday, hurt most by losses in miners and tech stocks and a fall in commodity prices following a recent rally.

The S&P/ASX 200 index ended 0.9% lower at 6,777.8.

A rise in bond yields also pressurised stocks, said Kyle Rodda, an analyst with IG Markets.

Higher bond yields usually have a negative impact on equities as they diminish the attraction from stocks' dividend payouts and make debt servicing harder for companies.

Australian bonds saw a major sell-off recently, while hopes of support from the Reserve Bank of Australia in the form of three-year bonds purchases were dashed on Wednesday.

Miners fell 2.3% after two consecutive sessions of gains, as iron ore futures declined 0.4% while awaiting a rebound in downstream demand. Global miners BHP Group and Rio Tinto fell 3.1% and 2.7%, respectively.

Tech stocks mirrored their Wall Street peers to drop 2.7%, with artificial intelligence company Appen Ltd declining 12.1% to be the biggest percentage loser on the benchmark.

Energy stocks were also lower, hurt by falling oil prices, as data showed US crude inventories unexpectedly rose last week. Oil and gas explorers Woodside Petroleum and Oil Search lost 1.1% and 1.6%, each.

Gold stocks shed 1.6% as bullion prices weakened overnight, but prices regained steam later on dovish remarks by US Federal Reserve Chair Jerome Powell.

Gold explorers De Grey Mining and Northern Star fell 3.2% and 3.6%, respectively.

Meanwhile, supermarket chain operator Woolworths Group ended higher after posting strong half-year results, but warned of slowing sales growth ahead.

New Zealand's benchmark S&P/NZX 50 index fell 0.9% as weaker financial and healthcare sectors weighed.

The country's central bank on Wednesday held interest rates at record lows and sounded a cautious note about the economic outlook.