The Australian share market has plunged for the second day in a row, snapping a string of six consecutive winning weeks as fears rose about a second wave of COVID-19 cases in the United States.
The S&P/ASX200 benchmark index regained some of its losses after being down as much as 3.4 percent before noon to close down 112.8 points, or 1.89 percent, at 5,847.8 points.
The All Ordinaries index finished down 119.6 points, or 1.97 percent, at 5,959.9.
The fall came after the Dow Jones Industrial Average dropped 1,862 points, or 6.9 percent, and the S&P 500 fell 188 points, or 5.9 percent.
With Thursday’s 3.1 percent drop, which snapped a string of seven winning days, the ASX200 finished the week down 2.5 percent, for its first losing week since the week ending April 24.
Bell Direct market analyst Jessica Amir blamed a rising number of COVID-19 cases in half a dozen U.S. states including Texas and Arizona.
“Markets don’t like surprises, even though we’ve talked about this for a long time,” she said.
“Analysts and fund managers were saying this was a key risk – and then it happened,” Amir said.
The market also didn’t appreciate U.S. Federal Reserve Chairman Jerome Powell warning Thursday of a “long road” to recovery, pouring water on the idea of a V-shaped bounceback.
Every ASX sector was lower on Friday with energy the worst hit, falling four percent, as Brent crude dropped 2.8 percent to just over US$37 a barrel.
Woodside fell 5.3 percent to $21.37 while Santos and Oil Search, Origin Energy and Beach Energy dropped between 3.6 and 5.7 percent.
All the big banks were lower with Westpac down 3.3 percent to $17.89, NAB down 2.5 percent to $18.59, ANZ retreating 2.8 percent to $18.92 and CBA dipping 1.6 percent to $67.32.
The big miners were down as well with BHP falling 2.1 percent to $35.99, Rio Tinto down 1.1 percent to $97.81 and Fortescue Metals dropping 0.5 percent to $14.81.
Goldminers proved no safe haven with Northern Star down 1.4 percent, Evolution down 0.4 percent and Saracen Holdings down 2.5 percent, although Newcrest advanced 0.2 percent.
TPG was a rare winner, though, rising 1.9 percent to $8.20 after the company announced it would pay a special dividend of 49 to 52 cents per share if shareholders approve its merger with Vodafone Australia later this month.
Coles was up 0.5 percent to $15.92 but Woolworths fell 0.4 percent to $36.67.
Seven Group Holdings rose two percent to $17.35 after chief executive Ryan Stokes told analysts the diversified holding company was seeing continued strength in most markets during the pandemic.
Zip Co dropped 3.5 percent to $6.30 despite reporting that revenue in May was up 78 percent year on year to $15.6 million.
The Australian dollar was buying 68.61 US cents, down from 69.27 US cents at the close of trade on Thursday.
ON THE ASX:
* The benchmark S&P/ASX200 index on Friday closed down 112.8 points, or 1.89 percent, at 5,847.8 points
* The All Ordinaries closed down 119.6 points, or 1.97 percent, at 5,959.9 points
* At 1734 AEST, the SPI200 futures index was up 11 points, or 0.17 percent, at 5,820 points
One Australian dollar buys:
* 68.78 US cents, from 69.20 US cents on Thursday
* 73.68 Japanese yen, from 74.03 yen
* 60.81 euro cents, from 60.94 cents
* 54.60 British pence, from 54.61 pence
* 106.66 NZ cents, from 106.71 cents.
By Derek Rose