The Australian sharemarket greeted the Trump era by dropping to a one-month low, further consolidating a streak of losses that saw it fall below 2016 levels last week.
The benchmark S&P;/ASX200 index closed down 0.8 per cent to 5611 points, bucking the trend set by most regional markets, which ended the day higher, with the exception of Japan's Nikkei which dropped 1.1 per cent.
![Wall Street has been smashing all-time highs in recent weeks.](/web/20170123112826im_/http://www.smh.com.au/content/dam/images/g/t/u/6/f/d/image.related.articleLeadwide.620x349.gtwqqg.png/1485161127659.jpg)
Atlantic Pacific Securities client adviser Gary Huxtable said the change in sentiment was due to the unjustified markets euphoria at the end of last year, particularly within the banking sector.
"Whilst some initial profit taking was to be expected, the fact our market has failed to find any level of support over the last couple of weeks would be starting to concern some investors," he said.
![Percentage moves in the 11 sectors that make up the S&P/ASX 200 Index. Source: Bloomberg](/web/20170123112826im_/http://www.smh.com.au/content/dam/images/g/t/x/9/1/l/image.related.articleLeadNarrow.300x0.gtwqqg.png/1485161127659.jpg)
Shares had actually been expected to rise at the start of trade following cautious gains on Wall Street in the wake of Donald Trump's inauguration speech.
But a surprise earnings downgrade from logistics company Brambles set the tone at the start of trade, sending the shares to their lowest point in nearly 11 months to close down 15.8 per cent at $10.34. The sell-off pushed other industrials, as Monadelphous lost 3.5 per cent and Downer EDI fell 2.2 per cent.
Also falling heavily were healthcare stocks, led by CSL which fell 2.7 per cent as traders locked in profits after gains in previous sessions. The banks couldn't hang onto early gains and lost between 0.1 p[er cent and 0.4 per cent.
Bucking the day's trend was Bega Cheese, up 1.9 per cent, cementing its significant gains in the three days since it announced its purchase of the Vegemite brand. Gold miners were also mostly higher thanks to a rise in the precious metal's price to $US1215 an ounce.
CMC Markets chief markets strategy Michael McCarthy said that while the weakening US dollar had pushed commodities prices higher, it was hurting a lot of internationally-exposed Australian businesses. "Throw in a few earnings downgrades, and it's just an ugly day on the markets," he said.
Despite this, Mr McCarthy said the day's light volumes meant it would be largely shrugged off by investors, who "wouldn't be reading too much into this year's early action".
Stock Watch: Ruralco
One bright spot on Monday, Ruralco shares surged 9.1 per cent to $3 after the agribusiness said it has surpassed last year's record first-quarter earnings. The company says live export volumes have increased following a restructure of the unit, with strong volumes and prices - and a recent uplift in the wool market - expected to continue. Ruralco, which in 2016 reported a 69 per cent fall in full-year profit due to divestments and the cost of restructuring, said increased plantings of cotton and rice boosted sales of agricultural chemicals and pre-season fertiliser. However, the company pointed out that the same rainfall that aided plantings had led to a slower-than-expected start to the year in its water infrastructure business.
Market movers
Currencies
The US dollar remained on the back foot, slipping more than 1 per cent against the yen, as investors locked in gains on the greenback's recent rise while they wait for US President Donald Trump to offer details of his promised stimulus. The US dollar fell as low as 113.435 yen, and was last down 1 per cent at 113.505, while the Aussie was trading close to a two-month high against the greenback, at US75.65¢. The Aussie posted its fourth straight weekly gain last week and is up more than 5 per cent so far in January, making it one of the best-performing major currencies this year.
Oil
The price of Brent crude slipped 0.1 per cent to $US55.43 a barrel after OPEC and non-OPEC countries made a strong start to lowering their oil output under the first such pact in more than a decade, as producers look to reduce oversupply and support prices. "The deal is a success ...All the countries are sticking to the deal ...(the) results are above expectations," Russian Energy Minister Alexander Novak said after the first meeting of a committee set up to monitor the deal on Sunday. Ministers said 1.5 million of almost 1.8 million barrels per day (bpd) had been taken out of the market already. Countries involved in the deal could reduce their output by 1.7 million bpd by the end of the month, Interfax news agency quoted Novak as saying.
Brambles
Brambles shares plunged 15.8 per cent after the supply chain logistics group downgraded its full-year earnings guidance on the back of revenue and cost pressures in North America. Brambles says that, taking into account currency fluctuations - 60 per cent of the group's revenue is generated in currencies other than the US dollar - it expects first-half sales revenue will be up 5 per cent and underlying profit will be up 3 per cent. The supply chain logistics group said that in light of those results it expects full-year results to be below its previous guidance range of 7 to 9 per cent for sales revenue and 9-11 per cent for underlying profit.
Gold
Gold prices rose to the highest in two months as investors seek safer assets amid uncertainty around the economic policies of new US President Donald Trump and as the US dollar declined against other major currencies. Spot gold has added 0.7 per cent to $US1217.81 per ounce, after earlier touching a high of $US1219.43, the most since November 22. Australia's gold producers enjoyed the support, with Newcrest Mining finishing up 1.7 per cent to $22, Evolution Mining up 3.2 per cent to $2.24 and St Barbara up 1.7 per cent to $2.41.