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(Australian Associated Press)
The Australian share market has fallen sharply for the second day in a row, after Donald Trump remarked that a trade deal with China might have to wait until late 2020.
The benchmark S&P/ASX200 index closed on Wednesday down 105.8 points, or 1.58 per cent, to 6,606.5 points, while the broader All Ordinaries was down 104 points, or 1.53 per cent, to 6,714.4 points.
“It was a second shocking day of red tracks today, definitely not a Santa rally, and it was all because of Trump,” said Bell Direct market analyst Jessica Amir.
“He’s wiped a lot of Christmas cheer off people’s faces – but people are saying it might be an early Christmas present.
“We think it’s a buying opportunity – good companies that are growing their bottom lines and have solid fundamentals that are backed by good managers – absolutely a buying opportunity.”
IG market analyst Kyle Rodda called it “a mass evacuation from equities, as traders pull profits out of what was until recently a very bullish market.
“It had to happen eventually, given how complacent the market had become, and how stretched valuations were – and really, still are.”
But the ASX200 closed above the important 6,600 mark, an important technical indicator.
Every sector except health care was at least 1.0 per cent lower, with the consumer staples falling the most, 2.2 per cent.
Woolworths dropped 1.9 per cent, Coles fell 2.9 per cent and and Coca-Cola Amatil, 2.7 per cent.
Of the big banks, NAB and ANZ both fell 2.1 per cent, to $24.90 and $24.19, respectively, while Commonwealth was down 1.9 per cent to $77.81 and Westpac dropped 1.0 per cent to $24.04.
In the heavyweight mining sector, BHP fell 2.5 per cent to $36.83, Rio Tinto dropped 2.1 per cent to $95.03 and Fortescue Metals dropped 1.2 per cent to $9.75.
South32 was the outlier, rising 0.8 per cent to $2.61.
Goldminers were mixed, Evolution down 3.7 per cent but Newcrest up 1.1 per cent, while Gold Road Resources rose 7.8 per cent after announcing a maiden resource statement for its Gilmour and Renegade deposits in WA.
A few other stocks were bright spots among the sea of red.
oOh! Media soared 23.9 per cent to a three-month high of $3.73 after the outdoor advertising company upgraded its earning guidance.
Adairs spiked 21.7 per cent to a 14-month high of $2.16 after buying family-owned New Zealand-based online retailer Mocka for around $85 million to $91 million.
The company was founded in a home garage in Christchurch in 2007 and expanded into Australia in 2011.
Xero rose 1.5 per cent to $81 after Morgan Stanley upgraded its price target on the cloud accounting platform to $90.
CSL helped prop up the health care sector, which was down 0.7 per cent, as the blood products and vaccine maker retreated a relatively modest 0.3 per cent to $277.19.
But the main story was losses, with shipbuilder Austal and plumbing and heating company Reliance Worldwide Corp among the biggest ASX200 losers, both falling 5.1 per cent.
The Aussie dollar is buying 68.23 US cents from 68.46 US cents on Tuesday.
ON THE ASX:
* The benchmark S&P/ASX200 index closed down 105.8 points, or 1.58 per cent, to 6,606.5 points.
* The All Ordinaries closed down 104 points, or 1.53 per cent, to 6,714.4 points.
* The SPI200 futures index closed down 88 points, or 1.31 per cent, to 6,611.
CURRENCY SNAPSHOT AT 1630 AEDT
One Australian dollar buys:
* 68.46 US cents, from 68.46 US cents on Tuesday
* 74.09 Japanese yen, from 74.75 yen
* 61.60 euro cents, from 61.83 cents
* 52.52 British pence, from 52.90 pence
* 104.73 NZ cents, from 105.15 cents.