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(Australian Associated Press)
The Australian share market has dipped in the final minutes of trade as the Eurozone failed to pass a stimulus measure after 16 hours of talks.
The S&P/ASX200 benchmark index had looked set to close flat despite weakness in the financial sector, but lost 38.8 points in the final minute of trade to finish Wednesday down 45.4 points, or 0.86 per cent, at 5,206.9 points
The broader All Ordinaries index shed 42.5 points, or 0.8 per cent, to 5,258.8.
“The market was basically bracing for a lacklustre day, because Wall Street had a very volatile session,” said Bell Direct market analyst Jessica Amir.
“It’s going to continue to be a very volatile time.”
A reason for the last-minute sell-off could not be stated categorically but it coincided with reports that a meeting of European Union finance ministers had concluded for the day without agreement on stimulus measures.
“After 16 hours of discussions we came close to a deal but we are not there yet,” tweeted Eurogroup president Mario Centeno, Portugal’s minister of finance.
“I suspended the #Eurogroup & continue tomorrow, Thursday.”
The banking sector was worst performer and was under pressure all day after Australian Prudential Regulation Authority advised banks to “seriously consider deferring decisions on the appropriate level of dividends until the outlook is clearer”.
Also, Fitch Ratings also downgraded the big banks credit rating to reflect the agency’s expectations of a significant economic shock in 1H20 due to measures taken to halt the spread of the coronavirus.
ANZ dropped 4.9 per cent to $15.52, NAB fell 4.8 per cent to $15.34 and Westpac declined 5.3 per cent to $15.25.
Commonwealth Bank – which is better capitalised than its peers and seen as the most likely to be able to keep paying dividends – dropped 3.3 per cent to $59.81, while Macquarie Group gained 0.5 per cent to $92.89.
Bank of Queensland was down 2.1 per cent to $5.03 after heeding APRA’s advice and deferring its first-half dividend.
Blood products giant CSL was flat at $311.94 and said after the close it would be providing an update on its operations in light of the COVID-19 pandemic on Thursday morning.
Austal jumped 5.4 per cent after the global shipbuilder reafirmed its earnings guidance and reported that its operations had been “largely unaffected by COVID-19”, with just four of its 6,000 employees testing positive.
Among the miners, BHP was down 1.2 per cent to $31.31, Rio Tinto dropped 1.5 per cent to $89.26 and Fortescue Metals fell 1.5 per cent to $11.25.
Goldminers were mixed, with Newcrest, Saracen and Regis falling between 1.5 and 1.7 per cent and Evolution, Northern Star and Gold Road Resources up between 1.4 and 2.5 per cent.
Property stocks turned around their earlier fortunes, with Stockland, Vicinity Centres and Unibail-Rodamc-Westfield soaring between 7.4 and 10.9 per cent after the announcement on Tuesday of a new commercial code of conduct for tenancy agreements that will be regulated by each state and territory.
Meanwhile, Treasury Wine Estate stocks rose 0.5 per cent to $10.61 after the company announced plans to demerge and spin off its Penfolds brand.
The Melbourne-based company said the move would create a new ASX top 50-100 company for Penfolds and an ASX 100-150 company for New TWE.
Woolworths dropped 3.1 per cent to $34.98 while Wesfarmers gained 2.4 per cent to $36.16.
ON THE ASX:
* The benchmark S&P/ASX200 index finished on Wednesday down 45.4 points, or 0.86 per cent, at 5,206.9 points
* The All Ordinaries closed down 42.5 points, or 0.8 per cent, at 5,258.8 points
* At 1731 AEDT, the SPI200 futures index was up 10 points, or 0.19 per cent, at 5,187 points
One Australian dollar buys:
* 61.32 US cents, from 61.84 US cents on Tuesday
* 66.74 Japanese yen, from 67.29 yen
* 56.50 euro cents, from 56.87 cents
* 49.86 British pence, from 50.13 pence
* 103.11 NZ cents, from 102.93 cents.