Australia Market drops on global growth woes

Headline indices of the Australian financial market tumbled on Friday, 08 March 2019, on following losses on the US and major European markets overnight after the European Central Bank slashed its 2019 growth and inflation forecasts, resurfacing concerns about a global growth slowdown. All ASX sector on the local bourse were in the red, with shares in financials, materials, and energy subsectors being notable losers. Around late afternoon, the benchmark S&P/ASX200 index fell 58.28 points, or 0.93%, at 6,205.60 points, while the broader All Ordinaries dropped 55.32 points, or 0.87%, at 6,288.90.

ECB President Mario Draghi said the economy was in "a period of continued weakness and pervasive uncertainty" as he pushed out a planned rate hike and instead offered banks a new round of cheap loans.

The U.S. jobs report on Friday will provide the next clues on the health of global growth after ECB President Mario Draghi delivered fresh stimulus as he downgraded the outlook for the region's economy. The move came during a week that's seen China cut its goal for economic expansion, the Bank of Canada dial back its expectations for policy tightening, dismal data from Australia to the UK, and the Organisation for Economic Co-operation and Development lowering its global outlook.

On trade developments, US President Donald Trump said on Thursday that negotiations to resolve his eight-month trade war with China were making progress, expressing fresh optimism about resolving the confrontation between the world's largest economies. Trump told reporters at the White House that the talks were "moving along pretty well." Chinese and American officials have alternated between expressing optimism that a deal is at hand and also warning that much remains to be done to resolve the trade war, which has rattled markets and dented manufacturing sectors on both sides of the Pacific. The two nations have slapped painful tariffs on more than $360 billion in two-way trade since July, but citing progress in the negotiations, Trump last month said he was suspending plains to raise duty rates on $200 billion in Chinese goods.

The heavyweight financials and materials sectors have been the main laggards. The four major banks were lower by more than 1%. Today, Commonwealth Bank (CBA) and Westpac (WBC) are before a Parliamentary economic committee and responding to actions taken from findings in the royal commission. CBA shares were down 2% while WBC fell 1.4%.

The mining sector selloff being led lower by losses in BHP Group (BHP), down 1.3%, and Rio Tinto (RIO) weaker by 1.8%. OceanaGold (OGC) rose 8% on a positive trading update at one of its gold mines in New Zealand.

CURRENCY: The Australian dollar was lower against the U.S. dollar on Friday. The Aussie dollar is buying 70.13 US cents, from 70.46 US cents on Thursday.

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