Australia Market extends losses as trade war fears persist

Headline indices of the Australian market closed down on Thursday, 30 May 2019, following a negative lead from Wall Street overnight as investors worried about mounting tensions in the US-China trade row and its impact on global economic growth. All ASX sectors declined, exception being telecommunication issue, with shares in information technology, energy, materials, consumer discretionary, consumer staples, and financials being notable losers. At closing bell, the benchmark S&P/ASX200 index dropped 47.92 points, or 0.74%, at 6,392.10 points, while the broader All Ordinaries fell 47.42 points, or 0.73%, at 6,489.20.

The market mood was dented by U.S. shades sliding overnight on concerns over the future course of the global economy. Beijing and Washington signalled the heightened risk of a prolonged trade war, stoking investors' concerns about the impact on global economic growth. This kind of deliberately provoking trade disputes is naked economic terrorism, economic homicide, economic bullying, China's Vice Foreign Minster Zhang Hanhui said, as Beijing continued to dial up its rhetoric amid the festering trade war with the United States.

 

China's Vice Foreign Minster Zhang Hanhui comments came after reports that Beijing may cut exports of rare-earth minerals used in the defense and energy sectors to strike back at Washington after US President Donald Trump remarked he was not yet ready to make a deal with China over trade.

Shares of materials and resources were lower, with Rio Tinto lower by more than 2%, BHP Group down 1% and Fortescue Metals down almost 1%.

Oil stocks were also weak after crude oil prices declined overnight. Santos lost more than 1%, Woodside Petroleum was lower by 0.3% and Oil Search was down 0.2%.

Shares of banks and financials were lower. The big four banks - ANZ Banking, National Australia Bank, Commonwealth Bank and Westpac - were down in a range of 0.3% to 0.6%.

CURRENCY NEWS: The Australian dollar was down against the U.S. dollar on Thursday. The Australian dollar was quoted at $0.6918, compared to $0.6919 on Wednesday.

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