The Australian share market is on course for its second worst month of 2018 after the Trump administration announced additional trade tariffs on China.
The benchmark S&P/ASX200 index closed down 23.5 points, or 0.38 per cent, per cent, at 6,161.5 points at market close on Tuesday, while the broader All Ordinaries index was 24.4 points, or 0.39 per cent, lower at 6,269.5 points.
CommSec chief market analyst Steven Daghlian said investors showed a general lack of enthusiasm due to the escalation of trade tensions.
“The tariff shows trade relations are worsening between the US and China, and that they aren’t seeing eye-to-eye,” Mr Daghlian told AAP.
The S&P/ASX200 index is down 2.6 per cent from the start of the month, second only to March’s decline of 4.27 per cent.
Confidence in the market continued to plummet following the announcement, with most indices performing poorly.
Resource stocks were some of the hardest hit, with BHP dropping 0.41 per cent to $31.48, while Rio Tinto was up slightly at 21 per cent to $73.16.
Origin Energy fell 24 per cent to $8.11 while Santos extended its losses for the day, sitting 13 per cent lower at $6.95.
Aged care stocks bounced back after a dramatic drop on Monday following Prime Minister Scott Morrison announcing a royal commission into the sector.
Regis Healthcare were up seven per cent to $3.07, Japara Healthcare was up 3.0 per cent to $1.42 and AVEO Group closed three per cent higher at $2.09.
Estia Health finished at 7.0 per cent at $2.47.
Kathmandu shares surged more than 10 per cent after strong profit results released thanks to a jump in the retailer’s Australian sales.
The Australian dollar had already taken hits in anticipation of the trade tensions between the US and China, and was only fleetingly impacted on Tuesday.
The Reserve Bank of Australia (RBA) used minutes of its September policy meeting to warn that protectionism was a “material risk” to an otherwise upbeat outlook for the global and local economies.
The bank also welcomed the “modest” decline in the Aussie, saying it would help support economic growth.
The Australian dollar was buying 72.13 US cents at 1630 AEST, compared to 71.60 on Monday.
ON THE ASX:
* The S&P/ASX200 closed down 23.5 points, or 0.38 per cent, at 6,161.5 points
* The All Ordinaries was 24.4 points, or 0.39 per cent, lower at 6,269.5 points
* In futures trading the SPI200 futures index was down 16 points, or 0.26 per cent, at 6,167.0 points at 1630 AEST
CURRENCY SNAPSHOT AT 1630 AEST:
One Australian dollar buys:
* 72.13 US cents, from 71.60 US cents on Monday.
* 80.98 Japanese yen, from 80.18
* 61.62 euro cents, from 61.55
* 54.82 British pence, from 54.71
* 109.31 NZ cents, from 109.18
The spot price of gold in Sydney at 1630 AEST was $US1,199.46 per fine ounce, from $US1,196.18 on Monday.