Risk aversion selloff triggered as worries about the coronavirus outbreak eclipsed hopes that broad policy support would combat the economic fallout. Adding to wariness were U.S. stock futures which slid 3.7 per cent in Asia, falling to their daily limit outside U.S. trade. U.S. stock futures sagged on speculation the administration of President Donald Trump may not be able to advance discussions smoothly on its proposed $1 trillion stimulus plan with Democrats
Around 90% of stocks lost ground on Wednesday. Banks, most large miners, energy stocks and tech were some of the hardest hit. Within those industries ANZ, South32 (S32) and Santos (STO) fell in the order of 10 per cent. Buy-now-pay-later company Afterpay (APT) slumped by 33 per cent as retailers also were hit hard on the expectation of a drop in discretionary spending. APT was briefly halted for two minutes at 3pm AEDT.
Airline stocks declined after Prime Minister Scott Morrison announced an international travel ban today for an indefinite period. Shares in Qantas (QAN) fell by 11.5%, Webjet (WEB) slumped by 13.5% and Flight Centre (FLT) shed 4.8%.
ECONOMIC NEWS: Australia Westpac Leading Index Signals Economy Entering Extremely Difficult Period-- Australia's leading index signalled that the economy is entering an extremely difficult coronavirus period, data published by Westpac showed on Wednesday. The Westpac- Melbourne Institute leading index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, fell to -0.96% in February from -0.49% in January. The index growth has remained below trend for the fifteenth straight month. Data showed that the Leading Index growth rate deteriorated over the last six months from -0.84% in September to the current -0.96%, largely due to initial developments around the Coronavirus outbreak.
CURRENCY: The Aussie dollar changed hands at $0.60 after declining from levels above $0.61 yesterday. Over the past eight sessions, the Aussie has shed around US$0.07 of its value.
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