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The Aussie market is back in the red on Friday as investors watch out for the spread of COVID-19 cases in the Northern Beaches of Sydney. The cluster has now grown to 28 in the past 48 hours with 10 new cases since 8pm AEDT last night.

The ASX 200 is down by 40 points or 0.6% to 6,716 even after US markets hit record highs at the close of US trading. The majority of sectors are in decline with financials, industrials and energy falling most while material, consumer staples and healthcare are advancing.

Several blue chip stocks are attempting to minimise broader losses with gains for big names such as Fortescue Metals (FMG) which is 2% higher, Woolworths (WOW) is up 1.8% while CSL Ltd (CSL) is adding 1%.

Among the major weights on the market have been the big 4 banks which are all in negative territory. National Bank (NAB) is down the most among its peers with a 1.7% slide as it holds its virtual AGM today. ANZ Bank (ANZ) is outperforming, easing just 0.3%.

Insurer, QBE Insurance (QBE) is 8% softer as it expects a US$1.5 billion statutory net loss in FY20 which is impacted by a US$520 million goodwill write-down of its North American business. COVID-19 costs are also expected to total US$470 million with US$130 million of elevated catastrophe costs. QBE”s interim CEO is confident on the outlook for the business.

Travel stocks are among some of the other notable decliners on concerns that the Sydney cluster will lead to more interstate border shutdowns and extra restrictions. Qantas (QAN) is down 4.3% while Flight Centre (FLT) has dropped 3.3% and Webjet (WEB) is 5.7% weaker.

One of the sharpest declines has been health stock Mesoblast (MSB) which is plunging 35% on a trial update for its proposed treatment for sufferers of Acute Respiratory Distress Syndrome (ARDS) relating to COVID-19. The trial was looking to achieve a 43% reduction in mortality at 30 days but is unlikely to meet that target.

The Aussie dollar has breached 76 US cents for the first time since June 2018 and is now buying 76.14 US cents, having peaked at 76.4 US cents.

Published by CommSec