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Australia, New Zealand: Shares follow global markets lower as virus cases surge

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Stocks in Australia and New Zealand languished at three-week lows as a surge in cases of novel coronavirus around the world spooked global markets and stoked fears that prolonged lockdowns would damage a nascent economic recovery.

[BENGALURU] Stocks in Australia and New Zealand languished at three-week lows as a surge in cases of novel coronavirus around the world spooked global markets and stoked fears that prolonged lockdowns would damage a nascent economic recovery.

The S&P/ASX 200 index declined 1.1 per cent, or 67.7 points, to 5,990.3 by 0057 GMT.

New Zealand's benchmark S&P/NZX 50 index also fell 1 per cent to 12,137.1.

Equities from across Europe to the United States dropped on concerns over a steady increase in Covid-19 cases, with sentiment worsening after French and German leaders announced new lockdowns to combat the virus' spread.

Worries about global infections also outweighed news that Melbourne's shops, restaurants and hotels opened for business on Wednesday after a four-month coronavirus lockdown.

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The Australian dollar, a liquid proxy for risk, was about 0.1 per cent weaker against the greenback.

The gold index slumped 4.4 per cent to hit a two-month low and led the declines. Westgold Resources and Gold Road Resources dropped 10.7 per cent and 5.3 per cent, respectively.

The country's biggest listed gold producer Newcrest Mining slid 3.7 per cent as it reported a decline in quarterly production.

Financial stocks slipped 1.6 per cent, with the "Big Four" shedding 1.6 per cent to 3 per cent.

Energy stocks tumbled 2.7 per cent, dragged by a 4 per cent drop in Oil Search and Santos.

Crude, considered a barometer of economic activity, sank more than 5 per cent overnight to reflect the fear of erosion of fuel demand.

The top percentage loser on the main index was online jobs portal Seek, down 8.6 per cent, after short-seller Blue Orca said the company's Chinese unit Zhaopin houses a lot of junk listings.

The number of issues on the ASX that advanced were 188 while 1,318 declined as a 0.1-to-1 ratio favoured decliners.

In the New Zealand index, Oceania Healthcare and Air New Zealand were the biggest decliners, down about 3.5 per cent each.

REUTERS

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