Nearly every sector on the local market ended in the red. Leading declines was the financials with Commonwealth Bank dropping 6.6% to A$68.50, National Australia Bank falling 6.3% to A$19.78, Westpac falling 5.3% to A$19.46, and ANZ falling 5.5% to A$19.96. The deputy governor of the RBA, Guy Debelle, gave a speech this morning that the central bank could look at unconventional monetary policy after it exhausts its cuts to official interest rates. This could include buying government bonds to keep yields low. All this would squeeze bank margins and weigh on profitability, but Dr Debelle noted that those actions would support the Australian economy and hence support bank's credit quality.
Shares in industrial sector declined, with Qantas down 9.2% at A$4.04 and Transurban down by 3.2% to A$14.09.
Mining stocks were also lower. Australia's largest listed gold producer, Newcrest (NCM) fell 7.2% as it lowers FY20 gold production guidance by roughly 11-13% from previous estimates. This is mainly due to issues at its Lihir gold mine in PNG. Elsewhere, Evolution Mining (EVN) was down 7% while Saracen (SAR) was 6.5% softer and Northern Star (NST) was 4% lower.
Consumer names were also lower, with supermarket giant Woolworths (WOW) losing 3.5% and Treasury Wine Estates (TWE), which owns brands such as Penfolds & Wolf Blass, was 5.5% weaker. A number of travel businesses have also decided to suspend or withdraw previously provided earnings guidance for the current financial year. This includes Webjet (WEB) which was mostly flat and Helloworld Travel (HLO) which was easing 2.2%.
ECONOMIC NEWS: Australia unveiled a A$2.40 billion health package on Wednesday that proposes to set up fever clinics and offer cost-free facilities for people to consult doctors over video calls, as it combats the spread of the coronavirus.
CURRENCY: The Aussie dollar changed hands at $0.6512 after its slip yesterday from levels above $0.657.
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