Australia Market drops on record job losses

The Australian share market finished session lower on Thursday, 14 May 2020, with buying sentiment dampened by a continued sell-off on Wall Street after the Federal Reserve chief highlighted the risks facing the US economy after coronavirus shutdowns. Meanwhile, selloff pressure intensified after data showed that jobs in the country fell the most on record in April, underscoring the economic toll of coronavirus-induced lockdowns. At closing bell, the benchmark S&P/ASX200 index declined 99.13 points, or 1.72%, to 5,328.72. The broader All Ordinaries dropped by 95.66 points, or 1.74%, to 5,418.02.

The Australian market opened substantially lower and remain traded into negative terrain throughout the day in the wake of back-to-back plunges in the U.S. market amid growing concerns about a prolonged pandemic-caused recession after Federal Reserve Chairman Jerome Powell's remarks in a speech suggesting the possibility of the U.S. economy recovering from the coronavirus crisis more slowly than expected. Powell's vowed to use the central bank's power as needed, but also suggested that might not be enough to avoid deep economic damage without more fiscal support.

The "big four" banks fell in the range of 2.6% to 3.2%, with top lender Commonwealth Bank of Australia among the biggest drags after two brokerages cut their price target for the company's stock.

Energy stocks tumbled after global benchmark Brent crude dropped 2.6% overnight. Woodside Petroleum and Santos fell 3% and 3.4%, respectively.

ECONOMIC NEWS: Australia Jobless Rate Climbs To 6.2% In April-- Australia jobless rate came in at a seasonally adjusted 6.2% in April, the Australian Bureau of Statistics said on Thursday. That was up from 5.2% in March. The Australian economy lost 594,300 jobs last month to 12,418,700 following the increase of 5,900 jobs in the previous month. Full-time employment decreased 220,500 to 8,656,900 people and part-time employment decreased 373,800 to 3,761,800 people. Unemployment increased 104,500 to 823,300 people. Underutilization rate increased 5.9 pts to 19.9%. The participation rate was 63.5% in April, well shy of expectations for 65.2% and down from 66.0% a month earlier.

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