Australia, New Zealand: Shares retreat from record highs as virus spreads

[BENGALURU] Australian shares retreated on Friday from a record close in the previous session as mounting new coronavirus cases in China and other Asian countries intensified fears over its spread and impact on the global economy.

The S&P/ASX 200 index was down 0.2 per cent at 7,148.4, as of 0015 GMT, but was on track for a third straight weekly gain.

The epidemic has already disrupted economic growth in China and a further spread to other countries could derail a "highly fragile" projected recovery in the global economy in 2020, the International Monetary Fund warned on Wednesday.

South Korea reported 52 new confirmed cases of coronavirus on Friday, Yonhap news agency reported, bringing its total to 156 and raising further alarm about the epidemic.

As of now, 25 other countries have reported 1,076 cases to the World Health Organization.

"Market is starting to realise the impact on supply chains due to the outbreak, and how long and protracted it could be especially if the numbers are greater than what we are being told," Brad Smoling, managing director at Smoling Stockbroking said.

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"Even if China was to go back to work tomorrow, it will take a long time for all the supply chains to come back online for the companies to get their production going," Mr Smoling added.

The local mining sector weighed on the benchmark, losing as much as 0.4 per cent. Heavyweight miners BHP Group and Fortescue Metals Group lost up to 0.7 per cent and 1.9 per cent, respectively.

Among healthcare stocks, biotech firm CSL and hearing implants maker Cochlear declined 0.5 per cent and 2.3 per ent, respectively.

The energy sub-index fell 0.6 per cent, but was on track to snap five consecutive weekly losses.

Santos fell up to 1.2 per cent, extending losses into a second session after posting a flat annual profit on Thursday, while Origin Energy lost as much as 1.9 per cent.

Among gainers, the gold sub-index advanced up to 0.9 per cent, with heavyweight Newcrest Mining rising 1.6 per cent, as bullion prices hovered near a seven-year peak as nervous investors opted for safe-haven assets.

Over in New Zealand, the benchmark S&P/NZX 50 index retreated from record close to swing between positive and negative territory, and traded down 0.1 per cent at 12,047.7. However, the index was on track to post a weekly gain of 1.7 per cent, its biggest in five.

Electricity generator Meridian Energy fell as much as 2 per cent, while Fisher & Paykel Healthcare Corp hit a record high after raising its full-year earnings outlook.

REUTERS