Shares finished in the black on Wednesday, but despite a bout of buying in the big four banks and consumer staples the ASX still suffered its worst monthly performance since January last year.
Widespread discussion that the property market is set for a breather saw investors pull their money out of real estate stocks, with the sector finishing down 1.1 per cent.
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ASX winners and losers - a snapshot
The stand out listings traded on the ASX captured at key moments through the day, as indicated by the time stamp in the video.
A fall in the oil price also weighed on energy names and investors throughout the market were discussing the high valuations in the top end of the market.
The benchmark S&P;/ASX 200 Index and the broader All Ordinaries Index each lifted 0.1 per cent to 5724.6 points and 5761.3 points, respectively.
![Tough month, positive day.](http://web.archive.org./web/20170602043321im_/https://www.fairfaxstatic.com.au/content/dam/images/g/w/f/b/n/w/image.related.articleLeadwide.620x349.gwh8lu.png/1496290251449.jpg)
"When you consider the current global context, economic growth and earnings are positive, but equity values are high," says David Sokulsky, chief investment officer at Crestone Wealth Management.
"We are relatively neutral at present, but cautious against taking on extra equity risk. As a result, we are recommending our clients hold a little bit extra in cash."
A dip in iron ore prices this week and headlines regarding the stockpiles of ore waiting in Chinese ports weighed on the big miners on Wednesday. Resource giants BHP Billiton and Rio Tinto slumped 0.4 per cent and 0.7 per cent respectively. With the iron ore price trading flat at $US58.50 a tonne, Fortescue Metals bucked the trend and closed up 1.3 per cent.
Retail stocks Myer and Super Retail Group received some buying support, after Credit Suisse announced the un-loved sector might be oversold in those instances. The bank upgraded both stocks to "neutral" and the stocks jumped 2.4 per cent and 1.3 per cent, respectively.
![The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each lifted 0.1 per cent.](http://web.archive.org./web/20170602043321im_/https://www.fairfaxstatic.com.au/content/dam/images/g/w/h/h/r/e/image.related.articleLeadNarrow.300x0.gwh8lu.png/1496290251449.png)
In other equities news, investors gave NIB Holdings a break, after a vicious selloff on Tuesday prompted Macquarie Bank to upgrade the private health insurer's shares to an outperform. The stock closed up 5.5 per cent.
Stock Watch: Domino's Pizza
Domino's shares declined 1.6 per cent to $57.47on Wednesday - taking their losses since the start of the week to 3 per cent - after the pizza chain announced it would be delaying the release of a Deloitte audit into its Australian franchise stores, following allegations of underpayment. Citing "the number of stores being audited", Domino's said the audit was "well-advanced but has yet to deliver its findings". The delay follows a sharp downgrade of the company by Morgans Financial on Monday. Analyst Josephine Little slashed her price target to $65.62, from $82.38, putting the company as a 'hold' due to weaker same-store sales growth targets. Of the 12 analysts who cover the stock, half have it as a 'buy', with an average twelve-month price target of $72.10.
Market movers
China's economy
Growth in China's manufacturing sector in May kept pace with the previous month, an official survey shows, beating expectations of a small drop, in a reassuring sign the world's second-biggest economy is not losing too much steam after a solid first quarter performance. The official Purchasing Managers' Index (PMI) stood at 51.2 in May, compared with the previous month's 51.2 and above the 50-point mark that separates growth from contraction on a monthly basis. Meanwhile, growth in the services sector accelerates, with the country's non-manufacturing PMI rising to 54.5, from 54.0 in April.
Iron ore
Dalian iron ore futures fell 3.4 per cent 435 yuan on Wednesday, resuming last week's selloff after a two-day holiday in China. The bulk commodity's spot price was at $US58.50 a tonne, close to its lowest since October. Analysts have been noting that while iron ore prices are falling, steel is trading close to five-year highs. "The rise in steel mill profitability, which mostly reflects weaker iron ore and coking coal prices, should give way to stronger steel output and iron ore demand in coming weeks," says CBA analyst Vivek Dhar.
Borrowing
Credit growth in the private sector maintained a softer pace over the start of this year in comparison to much of last year. Credit grew 0.4 per cent in April, following growth of 0.3 per cent in the previous two months. By comparison, credit growth averaged 0.5 per cent per month over 2016. As St George points out, the tightening of lending regulations by APRA in late March was captured for the first time in Wednesday's release. "Although the pace of lending to investors eased marginally, overall the pace of housing lending remains solid, suggesting limited initial impact from the measures," said the bank.
Seek downgrade
Seek shares dropped 1.6 per cent to $16.89 after Citi downgraded the stock from neutral to sell and cut its price target from $16.20 to $15.30 because of the impact the end of the housing boom would have on job listing volumes. The shares have declined 4 per cent over the last three days, to $16.89. Citi says there has been rapid growth in ads for construction, trade, manufacturing and related jobs since 2014 even as the unemployment rate remained flat, but that those jobs are set to fall away following the peak of the housing market.