ASX200 slips on US chaos, mining woes during July 22, 2024 trading day

The local sharemarket fell on Monday on the back of Friday’s CrowdStrike chaos, escalating uncertainty around the US presidential election and an extended slump in the heavyweight mining sector.

The benchmark ASX200 fell 39.9 points, or 0.5 per cent, to close at 7931.7, while the broader All Ordinaries index shed 42.8 points, or 0.52 per cent, to finish at 8166.4.

Tech stocks fell 0.79 per cent to 3073.7.

The pain was widespread, with nine of 11 industry sectors ending in the red, led by a sharp sell off in the energy sector, which slumped 1.62 per cent on the back of heavy falls in oil prices.

WTI Crude Oil hit $78.64 on Friday for a 4.3 per cent fall across last week, weighed down by ceasefire prospects in Gaza, tepid Chinese economic data and a rebound in the US dollar.

Oil and gas heavyweight Woodside Energy tumbled 2.1 per cent to $28.60 a share after the company announced a $1.35bn deal to acquire US LNG export developer Tellurian.

Woodside will take control of the Driftwood LNG project near Lake Charles in Louisiana, which boasts approvals for five LNG trains through four phases with a total permitted capacity of 27.6 Mtpa.

Santos fell 0.87 per cent to $7.95 and Beach Energy shed 2.57 per cent to $1.52.

The big miners also lost ground, led by South32 with a dramatic 12.57 per cent tumble to $2.99.

The diversified miner flagged a $831m pre-tax write down of its Worsley Alumina operation in its June 2024 quarterly report.

BHP fell 0.29 per cent to $41.64 and Fortescue slipped 0.46 per cent to $21.52.

Rio Tinto edged up 0.4 per cent to $114.45.

The local bourse also reeled from Friday’s global IT outage, which sent chills through Wall St.

The Dow Jones slumped 377 points, or 0.93 per cent, to close at 40,287 points, while the S and P 500 fell 0.71 per cent to 5505 and the tech-heavy Nasdaq index lost 0.81 per cent to 17,726.

CrowdStrike crashed 11 per cent to $US304 after the breakdown, while tech behemoth Microsoft lost 0.74 per cent to $US437.

“While Friday’s global IT outage raised concerns about the disaster recovery plans of many of the world’s largest organisations, the resolution of the outage should see the focus of markets return to upcoming second quarter 2024 earnings reports from tech giants Alphabet and Tesla and this week’s key economic data,” IG markets analyst Tony Sycamore said.

“The second quarter advanced estimate of GDP growth is expected to show that the US economy expanded by 1.9 per cent, up from 1.4 per cent in the first quarter.”

The rollercoaster US election took another stunning turn early Monday Australian time, with President Joe Biden announcing he will not campaign for a second term in office.

“Early market reaction is likely to be that Trump is modestly less certain to win the election, though still the strong favourite,” Betashares chief economist David Bassanese said.

“As such, we may see a modest unwinding of the ‘Trump trade’, which has been characterised as a firmer US dollar and US yield-curve steepening due to concerns over ongoing large US fiscal deficits.

“Also of importance, to the extent a new Democrat candidate makes it less likely Republicans win a ‘clean sweep’ with the Presidency and majorities in both the Senate and Lower House, markets may take comfort from the greater prospect of ongoing Washington gridlock, which would limit the chance of major policy changes.”

The big banks shifted lower with the exception of Commonwealth Bank, which pared back losses in a late afternoon rise to end the day flat at $131.68.

ANZ lost 0.74 per cent to $29.49, Westpac shed 0.53 per cent to $28.07 and NAB fell 0.86 per cent to $36.92.

The top gainer on the ASX200 was software company Iress, which jumped 9.3 per cent to $9.85 after reporting an expected 50 per cent uplift in earnings for H124 to between $65m and $67m.

The largest laggard was South32.

The Aussie dollar lost 0.31 per cent to buy US66.6c at the closing bell.