At closing bell, the benchmark S&P/ASX200 declined by 74.80 points, or 1.12%, to 6,607.05. The broader All Ordinaries dropped 74.32 points, or 1.07%, to 6,881.41.
New South Wales, Australia's most populous state, called on residents in three cities to be tested for COVID-19 and isolate, while the country's largest city Sydney continued to battle a number of virus clusters. The health ministry said it would bring forward its COVID-19 vaccine rollout plans by two weeks to early March, as fears of a wider outbreak mounted.
Market losses were widespread with the majority of the market closing in negative territory. Heavyweight stocks and sectors mainly dragged with financials, materials, healthcare and IT all finishing well in the red.
Energy stocks rallied on the back of a near 5% spike in global oil prices overnight after Saudi Arabia's surprise decision to cut production by ~1 million barrels per day (mbd) for February and March. Oil Search (OSH) shares rallied 5.7%. Santos (STO) added 2% and Woodside lifted 1.7%.
Lithium miner, Pilbara Minerals (PLS) was up 7% following a record December Quarter for shipments of spodumene concentrate, with a total of 70,609 dry metric tonnes (dmt). This was a 38% lift from the previous quarter and exceeded sales guidance of 55,000 to 70,000 dmt.
ECONOMIC NEWS: Australia Services PMI Expands To 5-Month High In December -
Australia services sector continued to expand in December, with a five-month high PMI score of 57.0, the latest survey from Markit Economics revealed on Wednesday. That's up from 55.1 in November and it moves further above the boom-or-bust line of 50 that separates expansion from contraction. Individually, there was a faster increase in new business, while growth in employment levels was sustained and business expectations remained high.
Although softening from a two-year high in November, the rate of input cost inflation remained marked. The rise in input prices was largely attributed to greater staff costs. Businesses partially passed on higher costs to clients by raising selling prices for the second month in a row. The survey also showed that its composite index improved to 55.6 in December from 54.9 in November.
CURRENCY NEWS: The Australian dollar changed hands at $0.7793 following a rise from levels below $0.768 yesterday.
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