ASX 200 afternoon report: 1 October 2024

The ASX 200 trades 78 points (-0.95%) lower at 8191 at 3.15pm AEST.

China's easing measures: uncertainty lingers

After a three-day winning streak, the ASX 200 has taken a dip, mainly due to the absence of support from China's markets, which are closed for a national holiday. Traders are also cautious, awaiting further details on China's recent easing measures.

While the People's Bank of China (PBOC) has confirmed the monetary easing measures announced last Tuesday, other reported stimulus measures, such as bank recapitalisation plans and government bond issuance, are yet to be officially confirmed. This uncertainty is affecting markets tied to the Chinese economy, including the Hang Seng (up nearly 25% in the past week) and our ASX 200, potentially leading to a deeper pullback.

Retail sales surge dampens rate cut hopes

According to new data from the Australian Bureau of Statistics (ABS), retail sales grew faster than expected in August, rising by 0.7% against a prediction of 0.4%. This increase, driven by unseasonably warm weather, reduces the likelihood of a Reserve Bank of Australia (RBA) interest rate cut before year-end. Consequently, the banking and consumer sectors have felt the pressure.

ASX 200 stocks

Qatar Airways impacts Qantas

News of Qatar Airways planning to acquire a 25% stake in Virgin Australia led to a 4.04% drop in Qantas’s share price to $7.12, just a day after reaching a record high of $7.49. If approved, the Qatar/Virgin partnership is expected to enhance price competition on international routes to and from Australia.

Materials sector

The ASX 200 materials sector, which soared 11.03% in September, dipped 2.35% today as investors locked in profits in major mining stocks.

• BHP down 2.85% to $44.65
• Rio Tinto fell 2.63% to $125.72
• Fortescue lost 2.44% to $20.18
• Mineral Resources edged 0.58% lower to $51.74

Banking sector

• Macquarie fell 1.41% to $229.09
• CBA slid 1.44% to $133.42
• Westpac eased 1.21% to $31.33
• ANZ dropped 1% to $30.17
• NAB edged down 0.5% to $37.16

Consumer-focused stocks

• Temple & Webster decreased 3.58% to $12.80
• Cettire lost 3.22% to $1.81
• Domino's fell 2.95% to $34.41
• Baby Bunting slipped 1.39% to $1.78

Health care sector

The ASX 200 health care sector, which started the week 6% below its August highs, has made gains for a second consecutive day. Leaders in this rally include:

• Cochlear surged 2.79% to $290.03
• ResMed added 1.84% to $35.61
• Ansell gained 1.38% to $32.25
• CSL climbed 0.54% to $287.71

ASX 200 technical analysis

Despite today's setback, the ASX 200 remains within its long-standing trend channel, suggesting potential for future gains as long as it holds above last week's low of 8111.30. However, if it drops below the 8120/00 support level, expect a deeper pullback towards 7900.00.

ASX 200 daily chart

• _{Source: TradingView. The figures stated are as of 1 October 2024. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation.}