Australia: Shares end at over 7-year low on recession fears; NZ slumps

[BENGALURU] Australian shares slumped to their lowest close in more than seven years on Monday as widespread curbs on travel and public life fed recession fears, overshadowing policy efforts against the coronavirus pandemic.

Further fuelling growth concerns, Australian companies ranging from retailers to casinos and toll road operators dumped their earnings outlook, hurt by the sweeping restrictions aimed at arresting the rapid spread of the virus.

The S&P/ASX 200 index fell 5.6 per cent to finish at 4,546.00, its lowest close since December 2012. The index had plumbed losses as much as 8.6 per cent earlier in the session.

"Social distancing, travel bans, event cancellations and shutdowns of non-essential services will mean that the hit to demand cannot be offset by monetary and fiscal stimulus," ANZ Research said in a note.

Australia on Sunday ordered pubs, cinemas, churches and casinos to close, while the government pledged an extra A$66.4 billion (S$55.84 billion) to shield the economy, its second fiscal stimulus package in a week.

Airlines flagged potential capacity cuts and cancelled more flights after Australia and New Zealand warned against non-essential domestic travel.

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Heavyweight financials stocks lost 10.2 per cent, with the "Big Four" banks losing between 9 per cent and 12 per cent.

Top lender Commonwealth Bank of Australia finished at its lowest since September 2012, while Westpac Banking Corp slumped to a more than 17-year low.

Retail conglomerate Wesfarmers Ltd declined 6.8 per cent and electronics retailer JB Hi-Fi plunged 10.8 per cent after withdrawing outlook.

Among mining stocks, iron ore miners Rio Tinto and Fortescue Metals Group shed 4 per cent and 7.7 per cent, respectively.

Bucking the trend, heavyweight biotech firm CSL Ltd ended 4.2 per cent higher, while Sonic Healthcare gained 6.3 per cent.

Meanwhile, New Zealand's benchmark S&P/NZX 50 index ended 7.6 per cent lower to finish at 8,498.70, its lowest close since May 2018. Earlier, the index marked its worst intraday drop, losing up to 10.7 per cent.

The country will be moving to its highest alert level, imposing self-isolation, with all-non-essential services, schools and offices to be shut over the next 48 hours.

Auckland International Airport slumped 7.4 per cent, while SkyCity Entertainment plunged 14.5 per cent after it said it would shut its casino in Adelaide.

Meanwhile, Fisher & Paykel Healthcare added 2.3 per cent after it was designated an essential service by the government, and said it will continue its operations in Auckland.

REUTERS