Soul Patts, Brickworks in tie-up; sharemarket to lift; Trump hikes steel tariffs; Washington, Beijing trade tensions in focus

The Australian sharemarket fell on Monday as the latest developments in US President Donald Trump’s global trade war weighed on investor appetite for risk assets.

The S&P/ASX 200 slipped 0.2 per cent, or by 20.6 points, to 8414.1 at the close, with eight of the 11 sectors in the red. The All Ordinaries also finished down 0.2 per cent.

The ASX started the week on a cautious note after Trump bounced back from a court ruling last week that tried to put a brake on his trade war, announcing a new 50 per cent tariff on steel and aluminium imports. That is up from a 25 per cent levy and due to take effect this week.

He’s also launched a fresh attack on Beijing’s trade agenda, arguing China had “totally violated” an agreement reached with the US, though he later said he would speak to Chinese President Xi Jinping. Beijing accused the US of “provoking new trade frictions” on Monday and slammed measures including US export controls on AI chips to China.

More uncertainty

The renewed tariff uncertainty has complicated stock picking for investors at a time when the ASX 200 is flirting with record highs, MLC Asset Management portfolio manager Anthony Golowenko said.

“Post the ‘liberation day’ losses, the additional dimension of quality when stock picking has become more pertinent – how well-placed a business is to navigate the ongoing trade uncertainty,” he said. “It was always there to some extent, but now it’s front and centre.”

Australian stocks tracked Wall Street’s retreat. Banks pushed lower with Westpac dropping 1.2 per cent to $32.18, Macquarie Bank 1 per cent to $212.12, while Commonwealth Bank posted a marginal gain.

Energy stocks dropped amid concern further trade restrictions on China would have an impact on global crude demand. Oil and gas giant Woodside retreated 1.1 per cent to $22 and Santos 1.5 per cent to $6.49. That was despite Brent crude’s more than 2 per cent advance after OPEC+ announced a supply hike that was smaller than some had feared.

Aluminium stocks also suffered losses following news of higher tariffs for the sector. Alcoa dropped by 4.8 per cent to $41.07 and South32 by 3.6 per cent to $2.94.

And iron ore miners also retreated as the steel-making ingredient touched a one-month low, hitting $US95 a tonne in Singapore. Rio Tinto dropped 1.7 per cent to $110.75 and Fortescue 2.5 per cent to $15.

Stocks in focus

BlueScope Steel advanced 4.4 per cent to $23.75 as investors tipped the company to be a winner from Trump’s decision to double tariffs on imported steel because it generates about half its profits from its US operations.

Soul Patts leapt 16.44 per cent to $43 and Brickworks rocketed 27.6 per cent to $35.10, after the two companies announced a merger to form a $14 billion ASX-listed investments, private capital, property and building products giant.

James Hardie rose 1.4 per cent to $35.94 after securing new debt totalling $3.5 billion with “broad support, including from 30 participating banks” to contribute to its takeover of Azek.

And Perenti jumped 3.5 per cent to $1.63 after being awarded a $1.1 billion, five-year contract to undertake underground mining at Endeavour’s gold operations in Burkina Faso. The latter edged up 0.7 per cent to $4.10.