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Aussie markets hurtle 6.4% lower on travel news

·2-min read
Passengers wait to check-in at the departures hall at the international airport in Sydney on March 18, 2020. - Australia urged its citizens on March 18, not to travel abroad and warned those already overseas to rush home as it imposed unprecedented steps to choke off the spread of the coronavirus epidemic taking off Down Under. (Photo by PETER PARKS / AFP) (Photo by PETER PARKS/AFP via Getty Images)
Passengers wait to check-in at the departures hall at the international airport in Sydney on March 18, 2020. - Australia urged its citizens on March 18, not to travel abroad and warned those already overseas to rush home as it imposed unprecedented steps to choke off the spread of the coronavirus epidemic taking off Down Under. (Photo by PETER PARKS / AFP) (Photo by PETER PARKS/AFP via Getty Images)

The benchmark S&P/ASX200 closed 6.43 per cent lower on Wednesday as the Australian government lifts the official travel advice to its strongest warning in history.

The broader All Ordinaries index finished 6.26 per cent lower, while the Australian dollar sunk to its lowest level in 17 years.

Australians travelling abroad have been urged to come home as soon as possible, while those planning international travel have been told not to travel anywhere internationally. This is the strongest travel warning Australians have ever received.

What happened in markets earlier today?

Skier in the Mont Blanc region
The S&P/ASX200 slid in a big way at the open on Wednesday. Image: Getty

The S&P/ASX200 fell 3 per cent at the open on Wednesday, despite a rally on Wall Street overnight.

Wall Street surged 6 per cent overnight after the Trump administration suggested a third stimulus package could be in the trillions, a larger injection than the 2008 bank bailout.

The falls come after the ASX200 saw its best day since 1997, finishing up 5.83 per cent and nearly halving the dramatic losses seen on Monday.

Airline bailout

SYDNEY, AUSTRALIA - MARCH 17: Qantas aircraft on the runway at Sydney Airport on March 17, 2020 in Sydney, Australia. Qantas and Jetstar will cancel almost all international flights as well as cutting domestic flights until May as travel demand collapses due to the COVID-19 pandemic. The Australian Government introduced strict border security measures on Monday, requiring all overseas arrivals to self-isolate for 14 days in a bid to stem the spread of coronavirus. The number of confirmed COVID-19 cases is now at 379 in Australia, with five deaths. (Photo by James D. Morgan/Getty Images)
Qantas has announced drastic measures. Image: Getty

Qantas (QAN.AX) shares dropped 16.78 per cent by 1059AEDT, and were sitting around $2.38 despite Prime Minister Scott Morrison’s announcement that the government will provide $715 million in aid to the country’s ailing airlines.

Qantas announced on Tuesday that it would be forced to suspend 90 per cent of its international flights, and Virgin (VAH.AX) today announced it would suspend all international flights.

Qantas share price in the last 12 months.
Qantas share price in the last 12 months.

Morrison today also upped the travel advice warning level to a level four, the highest it has ever been. That level of travel advice warns Australians against all international travel, and comes as the Department of Foreign Affairs and Trade urges all Australians abroad to return home as soon as possible, as international border closures make return travel difficult.

The Reserve Bank of Australia is expected to announce further measures to support the economy on Thursday, while the Federal Government will provide details of its second “cushioning” financial package later this week.

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