Australia’s volatile share market has plunged almost seven per cent after sentiment for equities suddenly soured in the US following rate cuts from the Federal Reserve and other central banks.
Futures had been pointing to a one per cent rise on Monday but the benchmark S&P/ASX200 dropped 373 points, or 6.74 per cent, to 5,166 at 1015 AEDT on Monday.
The broader All Ordinaries index sank 368.5 points, or 6.59 per cent, to 5,222.2 after the US futures markets opened lower following Federal Reserve and other central bank rate cuts.
Industrials shed almost 10 per cent, while the energy and consumer discretionary indices dived more than eight per cent after 15 minutes of trading.
Analysts are expecting the Reserve Bank of Australia to step in early with an emergency rate cut.
The next board meeting is three weeks away but global economies, including Australia’s, continue to deteriorate.
“There seems little point in waiting three weeks to deliver further support to the Australian economy on the interest rate front,” NAB’s economy watch note says on Monday.
The Aussie dollar was buying 61.44 US cents at 1015 AEDT, down from 62.98 US cents as the market closed on Friday.
AAP
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