The S&P/ASX 200 Index (ASX: XJO) is having a pretty dreadful day so far this Thursday, no two ways about it. At the time of writing, the ASX 200 has lost a nasty 2.7% and is sitting at 7,008 points.
With a fall of this magnitude, you would reasonably expect falls across the board for most ASX shares. And that is mostly true. All ASX sectors are deep in the red as it presently stands. With one glaring exception.
Despite the market's woes today, the S&P/ASX All Ordinaries Gold (ASX: XGD) is firming, rising by 1.7% at the time of writing. Consumer Staples shares are also faring arguably well, all things considered. This sector is down by 0.78%, far better than any other ASX sectors in the red today. In earlier trade, the consumer staples sector was in the green.
Gold often shines when there is fear or panic in the market. Not to mention global geopolitical tensions. So that one isn't too much of a mystery. But consumer staples?
Consumer staples companies are the businesses that manufacture and sell life's essentials. Think food, drinks, hygiene products, and household necessities. Vices like tobacco and alcohol are also classed as consumer staples.
Looking at individual ASX shares, we can see many in the green today.
Why are ASX gold and consumer staples shares defying the bloodbath?
Take the Woolworths Group Ltd (ASX: WOW) share price. It's currently up 0.43%. Coles Group Ltd (ASX: COL) is only slightly down by 0.5%. Newcrest Mining Ltd (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) are in the green so far today. So what's going on?
Well, it's not entirely clear. Perhaps investors are just looking for safety on a day like today. Because of their needs-based nature, consumer staples are often viewed as something of a safe harbour. We all need to eat and drink, after all. And that doesn't change in times of economic hardship, or in the event of a Russian invasion in Ukraine. Thus, consumer staples, together with gold, look like safer ASX shares when there is fear in the market.
The fact that both Coles and Woolworths, the poster children of ASX consumer staples, reported what appear to be well-received half-year earnings this week might also be helping.
The Woolworths share price edged 1.3% higher yesterday despite the company revealing weaker results. Coles went 3% higher on Tuesday after beating some analysts' expectations with their results.
Whatever the reasons for the comparative strength in gold and consumer staples ASX shares, it's likely providing at least some comfort to those shareholders today.
