The Australian share market reversed all of yesterday’s gains in the first 10 minutes of the opening bell before with the index eventually put the brakes on the slide and managed to recoup some losses, with the benchmark S&P/ASX 200 Index finishing the Thursday’s session down -104.3 points, or -1.98%, at 5,154.3, while the broader All Ordinaries index dropped -102 points or -1.93% to 5,188.7.
It was the financials sector turn to weigh on the index by a -4.21% decline after the Reserve Bank of New Zealand ordered the “Fab Four” (banks) to stop paying dividends back to their parent banks in Australia in order to build up more earnings to protect the New Zealand economy.
The decision was made to help stabilise the New Zealand economy as the coronavirus wreaks havoc. The dividend freeze follows a similar decision in the U.K. last week.
Moody’s also downgraded its outlook for the major banks to negative from stable, saying it was cautious on the banks’ operating environment and loan performance.
The Commonwealth Bank slid -3.8% to $61.24, as it announced it would make a one-time payment to all customers who are receiving a home loan deferral because of the coronavirus.
Meanwhile, Westpac Banking Corp shares fell -4.3% to $15.98 after revealing it would make Peter King’s interim chief executive appointment a permanent one.
The National Australia Bank slid -5.6% to $16.00, and Australia and New Zealand Banking Group closed the session -5.3% lower to $16.15.
Macquarie Group, meanwhile, fell -1.4% to $88.06, with insurers QBE Insurance Group plummeting -4.97% to $8.42 and Suncorp -4.35% to $9.02, respectively.
The major miners were also weaker with Titans, BHP slipping -1.26% to $29.85, with Rio Tinto falling -1.13% to $87.40, while Fortescue dropped -3.48% to $9.99.
Goldminers manage to polish up their act with Newcrest rising +4.02% to $24.34, with Evolution climbing +5.13% to $4.10 and Northern Star gained +0.78% to $10.39.
Blood products giant CSL gained +0.4% to $308.27, Sonic Healthcare fell -6.5% to $23, and Ramsay Health Care slipped -3.8% to $59.55.
Elsewhere, Transurban fell -3.3% to $11.85, with Woolworths slipping -0.7% to $35.77, Sydney Airport slid -6.9% to $5.40 and Telstra lost -1.3% to close at $3.16.
Tech stocks collectively dropped -3.6%, with Xero slipping -5.4%, Altium fell -4.7% and WiseTech Global down -5.8%.
Adelaide Brighton weakened after it became the latest company to withdraw its earnings guidance because of uncertainty surrounding how long the coronavirus pandemic may persist and its impact on the economy. The company’s shares fell -5.1% to $2.06.
Early education provider, G8 Education shares, soared +28.6% to $1.08 after the Federal government announced it would help subsidise the childcare industry and keep 13,000 facilities open.
International education placement company IDP Education soared +27.60% to $14.75 after it announced the successful completion of a $225 million institutional placement to strengthen its balance sheet.
Property companies Dexus, Mirvac, Vicinity Centers, and GPT Group, were all down between -4.1% and -5.7%.
Webjet gained +1.8% to $2.78 after completing a similar equity raising for $231 million.
Looking ahead, investors are looking forward to this evening’s U.S. unemployment claims with the forecast holding at 3.5 mil, with the previous month release at 3.2 mil.
Then on Friday, is the main event to this week, as we get the release of the U.S. jobs report, which will likely show a sharp drop in payrolls.
The Non-Farm Employment Change forecast holds at -100k, with the previous month release at +273k, with the Unemployment Rate expected to rise to 3.8%, with the last statement at the 50-year lows at 3.5%.