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Telstra and JB Hi-Fi led shares lower

Announcement posted by de2 Communications 16 Aug 2016

16 August 2016: SYDNEY -- The Australian share market struggled today, with losses in most major sectors weighing.

“Weakness in telcos, consumer discretionary and utilities, as well as minor losses in other sectors, were enough to overcome strength in materials and energy plays,” said Chris Conway, head of research at Australian Stock Report.

Telco giant Telstra (TLS) dropped 1.1% and consumer electronics retailer JB Hi-Fi (JBH) slumped 3.6% to lead their respective sectors lower. 

It wasn't all bad news however, with commodities linked plays enjoying some well needed buying interest. Mining giant Rio Tinto (RIO) added 0.9% and Fortescue (FMG) jumped 1.8% to lead the miners.

Meanwhile, Santos (STO) led the oilers, tacking on 2.5%. 

Amongst companies reporting, G8 Education (GEM) was the standout - but for all the wrong reasons. GEM slumped 12.5% after the education provider's first-half profit fell 12%. 

This morning, stocks were off to a subdued start on the back of some big moves and drops in numbers with some stocks being punished by investors.

“It seems the party is momentarily over for Domino’s Pizza fans,” said Conway.

“The company delivered a near 30% increase in net profit, but it simply hasn’t been enough to meet very lofty expectations,” he said. 

“This is a perfect example of seemingly great result being reacted to negatively when expectations are too great and the stock is off more than 5% on the back of it,” said Conway. 

On the other hand, financial group Challenger was enjoying the ride. 

“Challenger has jumped as much as 5% are delivering results beyond expectations,” said Conway. 

“Investors would do well to always remember that whilst headline number can both look and indeed be very impressive, if they miss expectations the stock price will ultimately get punished,” added Conway. 

On the day the ASX 200 gave up eight points (-0.1%) to settle at 5532.


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For more information or additional details, visit: http://www.australianstockreport.com.au/