The Australian stock market is notably lower on Thursday, extending losses from the previous session, following the overnight sell-off on Wall Street amid concerns about excessive stock valuations and as the U.S. Federal Reserve said it will maintain asset purchases at the current rate until “substantial further progress” has been made toward its goals of maximum employment and price stability.
The benchmark S&P/ASX 200 Index is losing 171.00 points or 2.52 percent to 6,609.60, off a low of 6,606.70. The broader All Ordinaries Index is lower by 181.00 points or 2.56 percent to 6,879.20. Australian stocks fell on Wednesday from an 11-month high as traders returned to their desks after a public holiday the previous day.
Among the major miners, Fortescue Metals is falling more than 3 percent, Rio Tinto is losing 3 percent and BHP Group is declining almost 2 percent.
Fortescue Metals reported iron ore shipments in the second quarter that was unchanged from the year-ago period as COVID-19 restrictions limited exports, but maintained its full-year outlook for iron ore shipments.
The big four banks – ANZ Banking, Commonwealth Bank, National Australia Bank and Westpac – are lower in a range of 2.3 percent to 2.9 percent.
Oil stocks are weak even as crude oil prices rebounded overnight. Oil Search is tumbling almost 5 percent, Santos is lower by more than 3 percent and Woodside Petroleum is losing almost 3 percent.
In the tech space, Afterpay is falling almost 5 percent, WiseTech Global is tumbling more than 4 percent and Appen is declining more than 2 percent.
Gold miners are also lower after gold prices fell for a fifth straight session overnight. Newcrest Mining is declining almost 2 percent and Evolution Mining is down more than 1 percent.
In economic news, the Australian Bureau of Statistics said export prices in Australia were up 5.5 percent on quarter in the fourth quarter of 2020, beating forecasts for a decline of 1.3 percent following the 5.1 percent drop in the third quarter. Import prices sank 1.0 percent on quarter versus expectations for a fall of 2.4 percent after sinking 3.5 percent in the three months prior.
On Wall Street, stocks closed sharply lower on Wednesday as traders finally seemed to be paying attention to concerns about the impact of new, more contagious coronavirus strains along with uncertainty about the prospects for a new relief package. Traders were also worried about recent speculative trading by retail investors amid continued spikes by heavily shorted stocks like GameStop and AMC Entertainment. Stocks saw further downside in late-day trading following the Federal Reserve’s first monetary policy announcement of the New Year amid disappointment that the central bank did not provide additional clarity about the outlook for its bond purchases.
The Dow tumbled 633.87 points or 2.1 percent to 30,303.17, the Nasdaq plunged 355.47 points or 2.6 percent to 13,270.60 and the S&P 500 slumped 98.85 points or 2.6 percent to 3,750.77.
Meanwhile, the major European markets also moved sharply lower on Wednesday. While the German DAX Index plunged by 1.8 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index tumbled by 1.3 percent and1.2 percent, respectively.
Crude oil futures settled higher on Wednesday after official data showed a substantial drop in U.S. crude stockpiles in the week ended January 22. WTI crude for March rose $0.24 or about 0.5 percent to $52.85 a barrel.
Market Analysis
Australian Market Extends Losses
2021-01-28 01:29:51
