Weakness in the Chinese economy has caused the Australian share market to kick off 2019 back where it was at the end in 2018 – down in the dumps.
The benchmark S&P/ASX200 index dropped 88.6 points, or 1.57 per cent, in late afternoon trading to finish at 5557.80 at 1615 AEDT on Wednesday.
The broader All Ordinaries was down 83.8 points, or 1.47 per cent, to 5625.6.
After treading water in the morning, the ASX – along with the Aussie dollar – started falling shortly after noon with the release of data showing factory activity in China fell in December for the first time in over two years.
Losses on the ASX were across the board with the energy sector down 2.58 per cent, financials down 2.01 per cent and telecom services down 2.48 per cent.
The Aussie dollar dropped nearly 0.7 per cent to as low as 70.02 American cents – its lowest level in nearly three years – before recovering some of its losses.
“It really has been out with old, in the with the old,” said James Tao, a market analyst with Commsec. “It’s really not the way we wanted to start the new year.”
ANZ was the worst of the big banks, trading down 60 cents, or 2.45 per cent, to $23.86.
Telstra was down 2.81 per cent, or 8 cents, to $2.77.
Starpharma Holdings lost 12.5 cents, or 10.55 per cent, to $1.06, despite news that its VivaGel condom had received regulatory approval in Japan. The condom contains a lubricant gel that kills HIV, the herpes virus and HPV.
The biggest company to have a good day was $3 billion gold mining company OceanaGold, which traded up 27 cents, or 5.56 per cent, to $5.13. But it was one of a very few in the green.
Ingham Group’s shares were clipped 3.37 per cent, to $3.97, after the poultry producer said its chief financial officer was leaving in six months. It gave no reason for the resignation.
South32 was down 2.39 per cent, to $3.27, on news that its strategic partner AusQuest was abandoning two prospective drilling sites in Western Australia that hadn’t panned out. AusQuest shares finished down 15.79 per cent, to 1.6 cents.
By shortly after 5pm the Aussie dollar had clawed back most its losses, trading at 70.37 American cents, or 0.23 per cent lower than Tuesday.
That’s still nearly 5 per cent lower than where it was back on December 4, when one Australian dollar bought 73.875 US cents.
ON THE ASX:
* The benchmark S&P/ASX200 index was down 88.6 points, or 1.57 per cent to 5557.8
* The All Ordinaries was down 83.8 points, or 1.47 per cent, to 5625.6.
* At 1415 AEDT, the SPI200 futures index was up 12 points, or 0.22 per cent, at 5499.
CURRENCY SNAPSHOT AT 1415 AEDT:
One Australian dollar buys:
* 70.2 US cents, from 70.53 on Tuesday
* 76.804 Japanese yen, from 77.385
* 61.31 euro cents, from 61.52
* 55.12 British pence, unchanged from 55.32
* 1.0479 NZ cents, from 1.0496
The spot price of gold in Sydney at 1415 AEDT was $US1,283.86 per fine ounce, from $US1,282.25 on Tuesday.