The Australian sharemarket finished a choppy session in the red as the commodity market rebound ran out of steam and weaker US data compounded domestic growth uncertainty.
The S&P/ASX 200 index dropped to a 0.4 per cent loss at the open, and after swinging in and out of the red for most of the session it closed down 4.5 points, or 0.08 per cent, at 5758.8 as bank stocks floundered and healthcare stocks led gains.
The Australian dollar lost US0.3¢ to US75.90¢ as the US dollar edged higher against most currencies despite the US Federal Reserve minutes revealing some doubt over inflation and the rate-rise trajectory.
US indices were mixed as Fed officials confirmed the view that the recent rate increases were targeted at cooling asset price increases.
“What also comes across in the minutes is increasing concern that the easing in financial conditions represented by the fall in bond yields, the rise in equity prices — and fall back in the dollar — so far this year, is adding to financial stability risks,” National Australia Bank head of currency strategy Ray Attrill said.
Government 10-year yields were slightly easier at 2.625 per cent after US 10-years dropped 2 points to 2.30 per cent as “hard” US data diverged from the bounce in “soft” business sentiment survey data.
US factory orders fell 0.8 per cent in May, the weakest report since November, while manufacturing orders declined 0.3 per cent, the first drop in 16 months.
Falling US auto sales compounded the uncertainty, with falls of between 4.7 and 7.4 per cent for major American car makers accelerating the three-year down-trend in passenger car sales.
The Shanghai composite index was down 0.2 per cent at the close of the ASX.
Spot iron ore was slightly firmer at $US63.28 a tonne yesterday but Singapore iron ore futures were down 1.4 per cent today.