The Australian share market pulled away from 11-month highs on Friday, 22 January 2021, as investors locked in gains following the benchmark recent gains amid hopes for a U.S. economic recovery under new President Joe Biden. Meanwhile, investors also took some money off the table ahead of the releases next week of October to December earnings from major companies
At closing bell, the benchmark S&P/ASX200 declined 23.35 points, or 0.34%, to 6,800.37. The broader All Ordinaries dropped 28.12 points, or 0.4%, to 7,078.94.
The slightly muted moves can be attributed to weakness from sectors like financials, energy, materials and IT being somewhat offset by improvements among healthcare, and both consumer staples and discretionary sectors.
The big four banks were down as much as 0.7% for National Bank (NAB) and also acted as a drag on the broader market.
Mining giants, BHP Group (BHP) and Rio Tinto (RIO) were additional drags, both down roughly 2% each. Fortescue Metals (FMG) underperformed with a decline of 2.2% despite remarks by Chairman and founder Dr Andrew Forrest that preliminary net profit after tax (NPAT) for 1H21 is expected to be in the range of US$4 billion - US$4.1 billion, compared to US$2.45 billion a year ago.
Rare earths miner Lynas advanced 13.7% to a seven-and a half year high of A$5.56, after it struck a deal with the US Department of Defence to build a commercial light rare earths separation plant in Texas.
ECONOMIC NEWS: Australia Retail Sales Down 4.2% On Month In December-- Australia total value of retail sales were down a seasonally adjusted 4.2 percent on month in December, the Australian Bureau of Statistics said on Friday, coming in at A$30.324 billion and following the 7.1 percent jump in November. Following the November rise, all industries except for Cafes, restaurants and takeaway food services fell. Household goods retailing led the falls (-9%), following the Black Friday sales, and new product releases, that boosted turnover in November. Similarly, other retailing, Department stores, and Clothing, footwear and personal accessory retailing, saw falls after reporting large rises in November. Food retailing fell 2%, with sales across the Food industry down in Victoria and New South Wales in line with restrictions on Christmas gatherings.
Australia Manufacturing PMI Expands Further In January- Australia manufacturing sector continued to expand in January, with a PMI score of 57.2, Markit Economics said in Friday's flash estimate. That's up from 55.7 in December and it moves further above the boom-or-bust line of 50 that separates expansion from contraction. Individually, goods producers enjoyed the fastest expansions in both sales and production in over three years. In some cases, monitored firms suggested that pending 2020 projects had been authorized. There remained signs of export weakness, however, with new orders from abroad down for the fourth straight month. The services PMI fell to 55.8 from 57.0 in December as firms recorded slower increases in both new orders and business activity. According to survey participants, growth was stymied by the COVID-19 pandemic and border restrictions. The composite index came in at 56.0, up slightly from 55.6 a month earlier.
CURRENCY NEWS: The Australian dollar changed hands at $0.7724, having risen from levels below $0.77 seen earlier in the trading week.
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