• The ASX 200 fell 1.60% to a 2-month low on Wednesday
  • Gold miners, Tech and Real Estate were hit hardest
  • The ASX will be closed on Thursday, but the Fed decision is due at 4am AEST

 

The ASX 200 gave up yesterday’s gains as it tumbled 1.6% on Wednesday to hit a two-month low.

The benchmark index tracked Wall Street’s broad losses overnight as the FOMC convened for the first of its two-day meeting.

Investors are bracing for a higher Fed hike, which has now boiled down to either a 75bp or 100bp increase. The decision is due out tomorrow morning at 4am AEST.

On the ASX, all 11 sectors fell with Mining and rates sensitive sectors Tech and Real Estate leading the selloff.

Gold miners were particularly hard hit as the spot price descends further to US$1663 an ounce.

Gold is caving under the strength of the US dollar and rising yields ahead of the Fed decision.

“Technically, the bearish trend is likely to continue. The break below USD1,675/oz suggests the price could fall to USD1,600/oz,” ANZ’s senior commodity strategist Daniel Hynes noted.

Gold miners Northern Star (ASX:NST) and Newcrest (ASX:NCM) fell by around 3% each today.

Coles (ASX:COL) was in the news today as it sold off a massive part of its operations to Viva Energy (ASX:VEA).

Coles entered into a binding agreement with Viva to sell its 700 Coles Express petrol station network for $300m. The COL share price finished 0.65% lower, while Viva surged 4.5%.

Meanwhile RBA deputy governor Michele Bullock revealed today that the billions of dollars of government bonds the RBA had bought to support the Australian economy during the pandemic meant the Bank incurred a loss of $37 billion and is in ‘negative equity’.

“While it has not sought a capital injection, the board has indicated to the government that it expects that future profits will be retained by the bank until the bank’s capital is restored,” Bullock said.

Looking ahead tonight, apart from the FOMC rates decision, investors will also get the US August existing home sales data.

The ASX will be closed on Thursday for a public holiday.

 

BIG CAP WINNERS

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Air New Zealand (ASX:AIZ) rose 7.5% after providing a half year earnings guidance for FY23.

The airlines said it currently expects earnings before tax for the first half of the 2023 financial year to be in the range of $200 million to $275 million, assuming an average jet fuel price of approximately US $130/bbl.

Whitehaven Coal (ASX:WHC) was up 4% and hit an all-time high after issuing a notice of Annual General Meeting to shareholders, which includes two resolutions seeking shareholder approval to extend the company’s share buy-back programme.

As previously announced, the company commenced an on market buy-back on 8 March to acquire up to 10% of shares over a 12-month period.

As at 20 September, a total of 93.5 million shares or around 9% have been bought back at an average price of $5.40 per share for a total cost of $504.3 million.

 

BIG CAP LOSERS

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Imugene (ASX:IMU) lost 13% despite reporting that the first patient has been dosed in intravenous cohort 1 as part of its VAXINIA Phase 1 clinical trial.

The study of TLX101 was done in combination with external beam radiation therapy (EBRT) in recurrent glioblastoma multiforme (GBM).

Australian Pacific Coal (ASX:AQC) fell 10% on no specific news.

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