Headline indices of the Australian financial market declined for fourth session in row on Wednesday, 13 March 2019, as profit-taking dominated on mixed US shares overnight. Risk appetite had further soured after weak domestic consumer confidence data reinforced a deteriorating outlook for the economy. Market mood was also dampened by British Prime Minister Theresa May's plan to leave the European Union being nixed in a parliamentary vote overnight. Around late afternoon, the benchmark S&P/ASX200 index fell 23.32 points, or 0.4%, at 6,151.50 points, while the broader All Ordinaries dropped 23.37 points, or 0.37%, at 6,237.20.
A measure of Australian consumer confidence slumped to its lowest in over a year in March as households were shaken by a slowdown in economic growth and the prolonged downturn in the property market. The Melbourne Institute and Westpac Bank index of consumer sentiment fell 4.8% to 98.8 in March 2019, the weakest reading since September 2017 and unwinding a 4.3% jump in February. The index, compiled from a survey of 1,200 people, was down 4% from a year earlier at 98.8, meaning pessimists now outnumbered optimists.
A soft US inflation report for February reinforced expectations the Federal Reserve will stay patient on rates and could even sound more dovish at its policy meeting next week. Annual consumer price inflation slowed to its lowest since September 2016 at 1.5%.
British lawmakers crushed Prime Minister Theresa May's European Union divorce deal, forcing parliament to decide within days whether to back a no-deal Brexit or seek a last-minute delay. Lawmakers voted against May's amended Brexit deal by 391 to 242 as her last-minute talks with EU chiefs on Monday to assuage her critics' concerns ultimately proved fruitless. Parliament will vote later Wednesday on whether to leave the EU with no deal, and if that fails, a further vote on Thursday will decide whether to extend the Brexit deadline.
Financial stocks led the day's losses, with three of the “Big Four” (Commonwealth, NAB, and Westpac) declining between 0.5% and 1%, after the federal government said it would no longer seek to abolish hidden commission payments to home loan brokers by banks, reversing a key recommendation from an inquiry into the sector and potentially placing banks in the political spotlight.
Mining stocks were also under pressure, with major global players Rio Tinto and BHP Group giving up as much as 0.9%, each.
Among individual stocks, pharmacy operator Sigma Healthcare fell as much as 6% after its board rejected a A$727 million takeover bid from Australian Pharmaceutical Industries as not in shareholder interest.
Yowie was up 26% after the confectionary maker became the subject of a $20 million takeover bid by investment firm Keybridge Capital.
CURRENCY: The Australian dollar was little canged against the U.S. dollar on Wednesday. The Aussie dollar was quoted 70.65 US cents, from 70.69 US cents on Tuesday