Australia Market tumbles on Omicron variant fears

The Australian share market has finished session lower on Monday, 29 November 2021, following the strongly negative cues from Wall Street on Friday, hit by worries about the damage that the Omicron coronavirus variant could inflict on the economy. The confirmation of two cases of the new variant in Sydney has also stoked fears.

At closing bell, the benchmark S&P/ASX200 declined 39.53 points, or 0.54%, to 7,239.82. The broader All Ordinaries index dropped 37.38 points, or 0.49%, to 7,562.49.

Total 9 of 11 sectors ended lower along with the S&P/ASX 200 Index, with real estate sector was worst performer, down 1.44%, followed by energy (down 1.42%), industrials (down 1.15%), and financials (down 1.07%), while materials was best performing sector, up 0.74%, followed by information technology (up 0.59%).

The top performing stocks in this index were HUB24 and BAPCOR, up 4.75% and 4.59% respectively. The bottom performing stocks in this index were UNIBAIL-RODAMCO-WESTFIELD and EML PAYMENTS, down 6.19% and 5.51% respectively.

Sydney stocks lost ground from the outset, following a steep drop in the U.S. Dow Jones index Friday, amid concerns on the new coronavirus variant traced in South Africa. The potential of more countries reinstating full lockdowns is sparking worries the pandemic could once again weigh down the global economy. The confirmation of two cases of the new variant in Sydney has also stoked fears. The market clawed back from early steep losses after the release of some upbeat corporate profits and business inventory data.

Energy stocks tumbled, with Woodside Petroleum and Origin Energy losing almost 2% each, while Oil Search and Santos are sliding more than 1% each. Beach energy is declining almost 1%.

Travel stocks took a hit in Monday trade, adding to losses seen Friday after reports of travel bans from multiple countries in response to the spread of the South African variant of Covid 19. Qantas Airways slipped 2%.

ECONOMIC NEWS: Australia Business Inventories Drop 1.9% In Q3- Australia company inventories were down a seasonally adjusted 1.9% on quarter in the third quarter of 2021, the Australian Bureau of Statistics said on Monday, following the 0.2% increase in the previous three months. Company gross profits climbed 4% on quarter, slowing from 7.1% in the three months prior. Wages and salaries were down 0.8% on quarter and wholesale trade sank 5.9%. On a yearly basis, inventories rose 0.7%, while profits climbed 5.4%, wages gained 4.7% and wholesale sales perked 2.1%.

CURRENCY NEWS: The Australian dollar changed hands at $0.7136, having dropped last week from above $0.725.

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