Australia: Shares end lower on recession fears
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AUSTRALIAN shares slumped on Monday (Oct 17), with commodity companies leading broad declines as searing inflationary pressures and worries about a potential global recession weighed on investor confidence.
The S&P/ASX 200 index ended 1.4 per cent lower at 6,664.4 points, with all sub-indexes in the red. The benchmark had risen 1.8 per cent on Friday.
Wall Street dropped on Friday as worsening inflation expectations kept intact worries that the Federal Reserve’s aggressive rate hike path could trigger a recession.
“The fog of battle with inflation is making it hard for investors,” said Henry Jennings, a senior market analyst at Marcustoday Financial Newsletter.
Hebe Chen, a market analyst from IG Markets, added: “Growth and stability are the two vital elements to form and bolster investing confidence in the market. Unfortunately, both of them are in shortage for the market today.”
Additionally, Chinese President Xi Jinping reiterating the validity of his zero-Covid policy at the opening of the ruling Communist Party Congress also hurt investor sentiment.
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In Australia, the mining index lost about 2 per cent due to weak iron ore prices in top steel-producer, China. Rio Tinto, BHP Group and Fortescue Metals Group fell between 1.1 and 2.3 per cent.
Additionally, the gold index slipped about 2.7 per cent, despite a slight uptick in bullion prices as the US dollar eased.
Index majors like Newcrest Mining and Northern Star Resources dropped 1.8 per cent and 4 per cent, respectively.
Adbri slid about 21.7 per cent, the most on the bourse, after the construction giant gave a weak outlook for the year and said its chief executive officer resigned.
Star Entertainment rose 1.5 per cent as a regulator-appointed manager was named to run its Sydney casino after being found guilty of preventing money laundering and criminal activity..
New Zealand’s benchmark S&P/NZX 50 index fell 0.7 per cent to finish the session at 10,785.9 points. REUTERS
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