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Australia Market drops on concerns for 2nd virus wave

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Capital Market
Last Updated : May 12 2020 | 3:05 PM IST
The Australian share market finished session lower on Tuesday, 12 May 2020, amid growing concerns over the risk of a second wave of coronavirus infections in countries that are easing restrictions. A ban on beef imports from four large Australian meat processors by largest trading partner China also weighed on the market's sentiment. Losses were across nearly every sector with energy, materials and financials sectors were down the most. At closing bell, the benchmark S&P/ASX200 index declined 58.17 points, or 1.07%, to 5,403.05. The broader All Ordinaries dropped by 61.82 points, or 1.11%, to 5,497.31.

The risk of a second wave of coronavirus infections resurfaced after an increase in new infection cases in countries that have loosened business restrictions, such as China, South Korea, France, and Germany.

The resurgence of the virus comes as Australia readies to partially open up public places in New South Wales, its most populous state, while Victoria is set to resume face-to-face teaching weeks earlier than expected.

A ban on beef imports from four large Australian meat processors by largest trading partner China also weighed on the market's sentiment. The suspension came as ties between the two countries soured over Canberra's support for an inquiry into the coronavirus outbreak's origin, although the Australian minister for trade denied the ban was retribution.

ECONOMIC NEWS: Australia NAB Business Conditions Weaken In April Australia's business conditions fell to -34 in April from -22 in March, survey results from National Australia Bank showed Tuesday. Overall conditions were deeply negative in all industries outside of mining. The fall in conditions was driven by all three components of the index namely trading conditions, profitability and the employment index. The employment conditions indicator decreased 15 points to -35. However, the business confidence rose to -46 in April from -65 a month ago. However, it was twice as weak as the trough in the 1990s recession.

CURRENCY NEWS: The Australian dollar changed hands at $0.648 after its decline from levels above $0.654 yesterday.

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First Published: May 12 2020 | 2:53 PM IST

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