The ASX 200 tumbled -2.0% on Thursday afternoon to a 1-month low, with the seasonally troublesome month of September living up to expectations.
The sharp decline reflects a few heavyweight stocks and sectors posting notable declines, which we'll discuss below.
BHP (ASX: BHP) shares went ex-dividend on Thursday for a final dividend of US$1.75 (A$2.55).
Based on Wednesday's close of $40.60, that's a dividend yield of approximately 6.25%.
It's worth noting that since BHP's unification with its London shares, the company's weighting in the ASX 200 has risen from 6.2% to around 10%.
BHP shares hit session lows of around -7.9% shortly after open, which would account for more than a third of the benchmark decline.
The Big 4 Banks added further insult to injury, all down around -2% at noon.
The Australian housing market is truly starting to roll over, with CoreLogic's home value index down -1.6% in August, the biggest national monthly decline since 1983.
"We are expecting to see less buying activity as higher interest rates and low sentiment continue to weigh on demand," said CoreLogic's research director, Tim Lawless.
“As borrowing power is eroded by higher interest rates and rising household expenses due to inflation, it’s reasonable to expect a further decline in consumer confidence and lower housing demand," he added.
This was further evidenced by ABS data on Thursday, which flagged an -8.5% month-on-month decline in new loan commitments for housing in July.
Sectors typically bought for stable dividends like real estate and utilities are also leading to the downside.
Global bond yields have started pushing higher again after hitting a peak around June. The Australian Government 2 and 10 year yields currently sit at 3.2% and 3.7%.
To add some perspective, the average market cap weighted dividend yield for the All Ords is 4.45%.
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