Australia: Shares record worst week in more than a year as miners drag

[BENGALURU] Australian shares skidded on Friday (Jan 21) to wrap up their worst week in more than a year, weighed down by miners as Whitehaven Coal slumped after cutting its 2022 forecast and Rio Tinto fell after Serbia revoked its lithium exploration licences.

The resources-heavy S&P/ASX200 closed 2.3 per cent lower at 7,175.80, after hitting its lowest since Sep 29 earlier in the session. It fell 3 per cent this week, its biggest since late October 2020.

Miners plunged 3.8 per cent, closing the week lower after 8 straight weeks of gains. The drop came after the vast mining state of Western Australia cancelled plans to reopen its borders on Feb 5, citing risks from the Omicron Covid-19 variant.

Steven Daghlian, a market analyst at CommSec, said profit-taking after recent gains in mining stocks also weighed.

Shares of Rio Tinto, BHP and Fortescue shed between 2.1 per cent and 4.8 per cent.

Serbia cancelled Rio Tinto's exploration licences on environmental grounds, while BHP investors in London and Sydney approved plans to scrap its dual listing on Thursday.

Energy stocks sank 3 per cent in their worst session since Dec 20, giving up all gains made this week as crude prices fell from 7-year highs.

Whitehaven Coal, Australia's largest independent coal miner, declined 6 per cent.

Tech stocks slid 2.3 per cent, tracking their US peers lower after a rebound on Wall Street fizzled overnight with the Federal Reserve's policy tightening on the horizon.

Computershare and Altium retreated 2.3 per cent and 3.3 per cent respectively.

Daghlian said next week's Reserve Bank of Australia meeting would be crucial to assess the central bank's tone on inflation, while the Fed's impending rate hike had instilled "degree of pessimism in the markets overall." New Zealand's S&P/NZX 50 index slid 1.2 per cent to finish at 12,348.00.

REUTERS