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Bond yields surge: ASX 0.09% lower at noon

At noon, the S&P/ASX 200 is 0.09 per cent lower at 7,111.50, as certain sectors sensitive to interest rates declined, while commodity sectors saw gains due to rising bond yields and high inflation.

The initial decline was influenced by negative international market trends following an unexpected increase in interest rates and hawkish guidance from the Bank of Canada. Bond yields surged, with three-year yields reaching an 11-year high of 3.874 per cent and 10-year yields reaching a five-month high of 3.996 per cent. Sectors such as technology, property, healthcare, and discretionary experienced declines, whereas sectors related to commodities like energy, utilities, and materials saw gains.

Oil prices steadied as investors considered mixed US data on crude and petroleum stockpiles, amid ongoing concerns about the demand outlook. West Texas Intermediate futures traded near $72 a barrel following a 1.1 per cent gain on Wednesday. Government figures showed that US crude inventories at the key Cushing storage hub rose for the seventh consecutive week, while petrol stockpiles also increased. However, there was some optimism for summer demand as refinery utilisation reached its highest level since 2019.

The SPI futures are pointing to a fall of 11 points.

Best and worst performers

The best-performing sector is Energy, up 1.89 per cent. The worst-performing sector is Information Technology, down 2.47 per cent.

The best-performing large cap is Whitehaven Coal (ASX:WHC), trading 4.72 per cent higher at $6.43. It is followed by shares in Computershare (ASX:CPU) and Yancoal Australia (ASX:YAL).

The worst-performing large cap is Xero (ASX:XRO), trading 4.63 per cent lower at $106.92. It is followed by shares in Sequoia Financial Group (ASX:SEQ) and ResMed (ASX:RMD).

Asian news

Asia-Pacific markets slid as Wall Street saw a pause in its market rally and the broad market index fluctuated near its highest closing levels since August 2022. Investors in the region also further assessed economic data that has been released this week.

China’s exports fell further than expected and Australia’s central bank defied market expectations by delivering a 25 basis-point hike.

In Japan, the Nikkei 225 extended its slide from Wednesday as it climbed 0.3 per cent, while the Topix rose 0.24 per cent.

Japan’s annualised GDP for the first quarter was revised to 2.7 per cent, higher than the 1.9 per cent expected by economists polled by Reuters and the 1.6 per cent posted in its preliminary figures.

South Korea’s Kospi inched down 0.19 per cent in early trade, while the Kosdaq slipped 0.24 per cent.

Hong Kong’s Hang Seng index is also set to fall after a brief rally on Wednesday, with futures at 19,116 compared with the HSI’s close of 19,252.

India’s central bank is expected to announce its interest rate decision today, with economists polled by Reuters expecting the Reserve Bank of India to hold rates at 6.5 per cent for a second consecutive time.

Company news

Iceni Gold (ASX:ICL) has hit a high-grade vein at the Everleigh well in Western Australia. Technical Director David Nixon comments: “The high-grade rock chip results from the vein are supported by the underlying UFF+ soil anomaly, prospectivity indicators and the multiple coincident targets.” Shares are trading 53.13 per cent higher at 9.8 cents.

Avita Medical (ASX:AVH) has announced FDA Approval of its spray-on skin cell product RECELL for the treatment of full thickness skin defects. CEO Jim Corbett comments, “The FDA approval now offers surgeons a best-in-class treatment option for a multitude of severe wounds within inpatient and outpatient settings.” Shares are trading 14.22 per cent higher at $4.90.

Antisense Therapeutics (ASX:ANP, US OTC:ATHJY, FSE:AWY) has announced that the first patient has been dosed in the company’s Phase IIb Duchenne Muscular Dystrophy Trial. Three patients are currently in the screening phase of the trial. Shares are trading 6.35 per cent higher at 6.7 cents.
Commodities and the dollar

Gold is trading at US$1782.70 an ounce.
Iron ore is 1.1 per cent higher at US$111.10 a tonne.
Iron ore futures are pointing to a 2.14 per cent rise.
One Australian dollar is buying 66.61 US cents.