Shares down 2.6% after Wall St sell-off

Australia’s share market is on course for its worst session since June after US investors sold the big technology companies overnight.

The S&P/ASX200 benchmark index was lower by 162.0 points, or 2.65 per cent, at 5950.6 points at 1200 AEST on Friday.

The plunge is on course to be the steepest since the index fell 3.05 per cent on June 11.

The All Ordinaries index was down 168.0 points, or 2.66 per cent, to 6133.0.

Materials, which includes the miners, dropped 2.54 per cent, while the impact for financials was similar, down 2.49 per cent.

Information technology had the greatest losses, 4.66 per cent, following the US trend.

Health shares were down 3.23 per cent. CSL shed 3.43 per cent to $280.97.

The losses come after Wall Street’s main indexes closed sharply lower and marked their deepest one-day declines since June as investors dumped the high-flying technology sector.

The Dow Jones Industrial Average fell 807.77 points, or 2.78 per cent, to close at 28,292.73, the S&P 500 lost 125.78 points, or 3.51 per cent, to 3,455.06 and the Nasdaq Composite dropped 598.34 points, or 4.96 per cent, to 11,458.10.

Earlier in the day, data showed the number of Americans filing new claims for unemployment benefits amid the coronavirus pandemic fell more than expected last week, but remained high. The next big data focus for investors is Friday morning’s monthly payrolls report.

Separately, a survey showed US services industry growth slowed in August, likely as the boost from the reopening of businesses and fiscal stimulus faded.

On the ASX, big miners could not escape the market’s downward momentum. BHP dropped 3.24 per cent to $36.39, Rio Tinto shed 2.38 per cent to $95.97 and Fortescue lost 2.53 per cent to $17.68.

Among the big banks, ANZ slipped 2.5 per cent to $17.91, Commonwealth Bank declined by 1.78 per cent to $66.96, NAB fell 2.57 per cent to $17.43 and Westpac was lower by 2.44 per cent to $17.17.

The bosses of the banks are speaking to a Senate inquiry on Friday about the economic effects of the pandemic.

ANZ chief executive Shayne Elliott expects banks to feel the worst of the coronavirus pandemic in the middle of next year.

He believes the economy will be at its low point between now and the end of 2020, which will flow on to the banking sector.

Elsewhere, online shopping business Kogan had one of the biggest losses, down 10.84 per cent to $19.32.

Fellow tech sector company Afterpay was lower by 5.63 per cent to $79.07.

The Aussie dollar was buying 72.74 US cents at 1200 AEST, lower from 73.09 US cents at the close on Thursday.

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