RTTNews - The Australian stock market ended in negative territory for the first time in six days, dragged down by resource stocks on lower commodity prices as well as profit taking following a recent rally. A weak closing on Wall Street following the release of disappointing economic data, and an unexpected domestic trade deficit in April also impacted sentiment, raising concerns about the strength of the economy which avoided a technical recession by posting growth in the first quarter. Profit taking was witnessed among stocks across the sectors following a smart rally in the past few trading sessions.

In the U.S., a report released by Automatic Data Processing Inc., or ADP, revealed that non-farm private employment fell by 532,000 jobs in May following a revised decrease of 545,000 jobs in April. Economists had expected a decrease of about 525,000 jobs compared to the decline of 491,000 jobs originally reported for the previous month.

A separate report from the Institute for Supply Management revealed that its index of activity in the service sector rose to 44.0 in May from 43.7 in April, although a reading below 50 indicates a continued contraction in the sector. Economists had been expecting a somewhat more notable increase to a reading of 45.0.

The Commerce Department, in a separate release, revealed a notable increase in factory orders in the month of April, but the increase came after a substantial decline in the previous month and was slightly below economist estimates.

The Dow closed down 65.63 points or 0.8% at 8,675, the Nasdaq closed down 10.88 points or 0.6% at 1,826, and the S&P 500 fell 12.98 points or 1.4% to 932.

The All Ordinaries Index opened below the 4,000-mark at 3,989 compared to its previous close of 4,009, mirroring the weak closing on Wall Street, and continued to slide further dragged down by resource stocks on lower commodity prices in the international market. After moving sideways for the bulk of the session, the index slipped further in reaction to the trade balance report.

Profit taking ahead of the release of key economic numbers in the U.S. during the course of the week also led to some apprehension. The index ended at 3,933, down 76.80 points, or 1.92%. The benchmark S&P/ASX 200 Index followed a similar trend and ended down at 3,935, with a loss of 82.60 points, or 2.06%.

On the economic front, the Australian Bureau of Statistics revealed that the trade balance unexpectedly turned to a deficit in April, coming in at a seasonally adjusted shortfall of A$91 million. Exports were down 11 percent month-over-month in April, falling A$2.76 billion to A$21.68 billion, while imports fell 2 percent or A$367 million to A$21.771 billion. Economists were anticipating a A$1.7 billion surplus for April following the revised A$2.393 billion surplus in March.

Crude oil prices recovered from a slump in International market on Wednesday and ended with a gain of 57 cents at $66.19 a barrel in Asian trading. Light sweet crude for July delivery closed sharply lower at $66.12 in New York Mercantile Exchange on Wednesday on weaker economic data in the U.S.

Resource stocks led the declines after a measure of six commodities traded in London Metals Exchange, comprising of copper, zinc and nickel among others, declined 1.8% on Wednesday. BHP Billiton declined 5.18%, Orica Ltd shed 3.04%, Oz Minerals lost 3.33% and Rio Tinto slumped 6.56%. Among gold stocks, Lihir Gold lost 3.95%, Newcrest Mining shed 2.99% and Sino Gold edged down 0.77% on higher gold prices.

In oil stocks space, Woodside Petroleum lost 3.57%, Santos shed 3.08% and Oil Search fell 4.01%.

Banking stocks ended mixed on profit taking, Commonwealth Bank edged down 0.03%, National Australia Bank lost 3.93% and Westpac Banking slipped 0.16%. However, ANZ Bank bucked the trend and ended higher with a gain of 2.93%.

For comments and feedback: contact editorial@rttnews.com