SYDNEY, AAP – The Omicron coronavirus variant has prompted a second consecutive day of selling on the ASX, although one expert disagreed with the reaction.
The market on Monday shed about half a per cent after more nations closed their borders to arrivals from Africa, where the variant originated. Japan will suspend entry for all foreigners.
The benchmark S&P/ASX200 index closed down 39.6 points, or 0.54 per cent to 7239.7 points.
The All Ordinaries closed lower by 37.5 points, or 0.49 per cent, to 7562.4 points.
Investsmart market strategist Evan Lucas could not justify the selling.
He said history showed markets later improved after the advent of the coronavirus and its variants.
“The initial (selling) reaction has been an over-reaction, and then the response has been robust to say the least,” he said of those developments.
“Will Omicron derail opening up the economy and travel and global growth? Probably not.
“There might be some interruptions but overall the world will accept Omicron is here.”
That acceptance may be slowly taking shape. The ASX fall was minor compared to Friday’s rout of 1.7 per cent.
Travel shares Corporate Travel Management, Qantas and Webjet shed at least two per cent.
Energy, financial, industrial and property shares lost more than one per cent each following similar slides on global markets.
The big four banks were all lower. ANZ fared worst and shed 1.66 per cent.
The mining giants were all higher. BHP was up 1.42 per cent. Fortescue was better by 2.39 per cent, while Rio Tinto improved by about one per cent.
Mr Lucas also said Omicron may play into the hands of OPEC leaders, due to meet this week.
They have resisted calls from the US and other nations to increase oil supply as prices soared amid the economic reopening. The uncertainty of Omicron may give them more reason to baulk at providing more supplies.
Oil prices recovered some of Friday’s plunge of $US10 a barrel. Brent crude was up about three per cent to $US75.38 a barrel.
Shares in Senex dropped almost three per cent to $4.27 after the gas provider said it would give a suitor more time to assess its financials for a possible takeover.
Posco International asked for two more weeks to finalise its most recent offer of $4.60 per share. Senex intends to unanimously approve the scheme.
Software vendor Nuix has had a second class action claim filed against it but shares were up 0.79 per cent to $2.56.
Shareholders claim the company prospectus misled them and filed the matter with the Supreme Court of Victoria. They have similar grievances to the shareholders who filed a claim earlier this month.
Nuix will defend the claims.
Today was the last day of trading securities in Spark Infrastructure after a takeover offer received court approval.
A North American consortium, called Pika Bidco, had its scheme approved to pay investors $2.7675 per security. They will also be paid a special distribution of 12 cents per security.
Spark securities were down 0.35 per cent at $2.87.
In the US this week, the “beige book” survey of business conditions will be one of the main data sets of interest. October’s report found supply-chain disruptions and labour shortages.
In Australia, national accounts figures for the September quarter are due on Wednesday. Economists have predicted a 2.5 per cent economic contraction due to lockdowns in three states and territories.
Meanwhile, the Australian dollar was buying 71.38 US cents at 1722 AEDT, largely unchanged from 71.39 US cents at Friday’s close.
ON THE ASX
* The benchmark S&P/ASX200 index closed down 39.6 points, or 0.54 per cent to 7239.7 points on Monday.
* The All Ordinaries closed lower by 37.5 points, or 0.49 per cent, to 7562.4 points.
* At 1722 AEDT, the SPI200 futures index was up nine points, or 0.12 per cent, at 7223 points.
One Australian dollar buys:
* 71.38 US cents, from 71.39 cents on Friday
* 80.77 Japanese yen, from 81.88 yen
* 63.30 Euro cents, from 63.63 cents
* 53.53 British pence, from 53.69 pence
* 104.53 NZ cents, from 104.68 cents.