Australia markets closed

ASX plunges 2.5pct as virus cases surge

Derek Rose
The ASX is set to fall early in trade

The Australian share market has suffered its worst loss in two weeks after a rise in coronavirus cases in both the US and Victoria.

The benchmark S&P/ASX200 benchmark index finished Thursday down 148 points, or 2.48 per cent, to 5,817.7, while the broader All Ordinaries index closed down 153.6 points, or 2.53 per cent, at 5,928.

"You're still seeing a lot of uncertainty, which is why the market fell in the first 10 minutes of trade, and continued to fall throughout the day," said Bell Direct market analyst Jessica Amir.

IG Market analyst Monte Safieddine wrote in a note that downside risks had been exposed on multiple fronts, including US-China tensions including the possibility of fresh sanctions, an IMF downgrade to economic projections, and the resurgence in coronavirus cases.

Another 33 coronavirus cases were found in Victoria, while in the US, cases were surging to their highest levels since April.

The losses on Thursday were across the board and came after a similar plunge on Wall Street, where the Dow Jones, the S&P500 and the NASDAQ lost between 2.2 and 2.7 per cent.

Battered down companies were among some of the worst performers, which Ms Amir attributed to selling to capture a loss for tax reasons in one of the last trading sessions before the close of the financial year.

Ardent Leisure dropped 12.2 per cent to 39.5 cents; Flight Centre drooped 11 per cent to $11.46; Ooh! Media fell 8.8 per cent to 93 cents; and Webjet retreated 8.6 per cent to $3.39.

Qantas shares were in a trading halt after the airline announced a $1.9 billion equity raising and that it would cut at least 6,000 jobs.

"A sad day for the 6,000 people who lost their jobs, but if you're a shareholder, there's light at the end of the tunnel, because they've said they're going to make a profit or break even," Ms Amir said.

CSL was a rare gainer, adding 0.5 per cent to $294 after the blood products giant, Australia's largest company by ASX-listed market capitalisation, agreed to pay around $2.9 billion for exclusive rights to a gene therapy treatment that could potentially cure haemophilia B.

US company uniQure produces the program called etranacogene dezaparvovec, or AMT-061.

Also, Accent Group gained 9.6 per cent to $1.49 after the Athlete's Foot and Hype DC owner forecast its full-year earnings would be 10 per cent ahead of last year, noting that online sales had continued to strengthen despite its stores reopening.

All the big banks were lower, with Westpac and NAB both down 3.5 per cent, to $17.42 and $17.91; ANZ dropping 3.1 per cent to $18.25 and CBA down 2.3 per cent to $67.65.

In the heavyweight mining sector, BHP dropped 2.4 per cent to $35.05, Rio Tinto fell 1.6 per cent to $97.06 and Fortescue Metals drooped 2.6 per cent to $13.87.

Goldminers were no safe haven, with Evolution falling 5.4 per cent, Northern Star down 4.2 per cent and Newcrest down 3.0 per cent.

Online artist marketplace Redbubble soared 25.5 per cent to an all-time high of $1.97 after announcing its operating profit had more than doubled in the first 11 months of the fiscal year.

The Australian dollar was buying 68.65 US cents, down from 69.41 US cents at the close of trade on Wednesday.

ON THE ASX

* The benchmark S&P/ASX200 index on Thursday closed down 148 points, or 2.48 per cent, at 5,817.7 points

* The All Ordinaries closed down 153.6 points, or 2.53 per cent, at 5,928 points

* At 1750 AEST, the SPI200 futures index was down 25 points, or 0.43 per cent, at 5,739 points

CURRENCY SNAPSHOT

One Australian dollar buys:

* 68.64 US cents, from 69.23 US cents on Wednesday

* 73.63 Japanese yen, from 73.80 yen

* 61.09 euro cents, from 61.27 cents

* 55.23 British pence, from 55.42 pence

* 106.78 NZ cents, from 107.33 cents.