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Australia: Shares ease as virus recovery appears a long haul

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[SYDNEY] Australian shares closed lower on Monday, dragged by the energy sector on weaker oil prices, and as authorities warned that the coronavirus outbreak in the country's second-most populous state could take weeks to control.

The S&P/ASX 200 index settled 0.6 per cent lower at 6,001.60, reversing Friday's gain.

Australia's acting chief medical officer said the outbreak in Victoria state could take weeks to subside despite a lockdown and orders to wear masks.

Victoria reported a daily record of 438 new Covid-19 cases on Friday, most of them from Melbourne, while New South Wales saw 18 new infections on Sunday, its highest in three months.

"Australian investors have their eyes on the second wave of Covid-19 infections, particularly with NSW, our biggest domestic economy," said James McGlew, executive director of corporate stockbroking at Argonaut.

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"Any acceleration in the numbers, as we have seen in Victoria, will raise anxiety and increase uncertainty."

Prospects of a stretched recovery from the outbreak hit travel stocks hard, with Victoria and New South Wales being busy commercial air traffic hubs.

Travel booking firm Webjet and Corporate Travel Management each closed about 3.6 per cent down.

The energy index fell 2.6 per cent to its lowest close since May 18 as oil prices declined on fears that a recovery in fuel demand could be derailed by a rise in the pace of coronavirus infections globally.

New Zealand's benchmark S&P/NZX 50 index closed 0.3 per cent lower at 11,553.16.

Among top losers, Pushpay Holdings fell 4.1 per cent, while Restaurant Brands New Zealand lost 2.4 per cent. 

REUTERS

 

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