High yield stocks were the focus of investor buying today on the ASX as China revealed a fall in the Purchasing Managers' Index (PMI) for the manufacturing sector, prompting a sell out of resources-focused stocks.
The All Ordinaries knocked off 24.7 points, or 0.5%, to close at 5,143.9 points and the benchmark S&P/ASX 200 eased 25 points, or 0.5%, to 5,166.2 points.
China’s PMI fell to 50.6% in April from 50.9% in March, in line with expectations. Above 50 still indicates expansion in the sector.
Another reason for the downward shift in Australian stocks is some profit taking, according to IG Markets analyst Evan Lucas.
The Telecommunications sector was the only sector to buck the downward trend, adding 16.5 points, or 1%, to close at 1,733.2 points.
Industry giant Telstra (ASX: TLS) dialled up a $0.05, or 1%, increase to close at $5.03 – its highest level in almost eight years.
Today’s surge above the $5 mark after revealing it had another 600,000 4G customers made Telstra one of the best performing blue-chip stocks on the ASX so far this year.
Miners drag market lower
Meanwhile, the Materials sector notched a 132.3 point, or 1.4%, loss to finish at 9,100.9 points.
The majority of miners found themselves in the red with Rio Tinto (ASX: RIO) falling $0.77, or 1.4%, to $55.03, while BHP Billiton (ASX: BHP) trimmed $0.53, or 1.6%, to close at $32.17.
Fellow iron ore player Fortescue Metals Group (ASX: FMG) slipped $0.02, or 0.6%, to $3.48.
Of the gold stocks, Newcrest Mining (ASX: NCM) dropped $0.36, or 2.1%, to $16.45, St Barbara (ASX: SBM) closed flat at $0.60 and Resolute Mining (ASX: RSG) plunged $0.06, or 6.3%, to $0.89.
Northern Star (ASX: NST) was an exception, climbing $0.04, or 5.9%, to $0.71, as was Regis Resources (ASX: RRL) with a $0.03, or 0.8%, jump to $3.80.
Mineral sands producer Iluka Resources (ASX: ILU) also made gains, rallying $0.07, or 0.8%, to $9.02.
The Financials sector closed 12.6 points, or 0.2%, lower at 5,838.8 points.
Westpac Banking Corporation (ASX: WBC) was the only one of the big four to gain ground, notching a $0.26, or 0.8%, increase to $34.06.
ANZ (ASX: ANZ) fell $0.15, or 0.5%, to $31.69, Commonwealth Bank of Australia (ASX: CBA) slipped $0.50, or 0.7%, to $72.95 and National Australia Bank (ASX: NAB) wiped off $0.05, or 0.15%, to close at $33.95.
U.S. stocks recovered from an early sell-off after mixed economic data which included a decline in Chicago manufacturing activity.
By the close the Dow Jones had gained 21 points to 14,840 points, while the NASDAQ rallied 22 points to 3,329 points – its highest level in more than 12 years. The S&P 500 closed at a record high of 1,597.57 points.
The Shanghai Composite Index and Hong Kong’s Hang Seng were closed today due to a public holiday.
Japan’s Nikkei shed 61.5 points, or 0.4%, to 13,799.3 points.
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