So where will the ASX go on Tuesday after Black Monday’s capitulation by investors across the world in the face of the COVID-19 virus’ uncertainty and the collapse in oil prices which triggered a plunge in energy shares?
Well, judging by the 233 point (around 4%) slump on the overnight ASX futures platform on Monday, the market will head lower and push the losses since the peak on February 20 closer to $500 billion.
The ASX 200 tumbled 7.3% to 5,760.6, shedding a whopping $137 billion and compounding on top of the 2.7% slide last Friday.
That 7.3% fall in the ASX 200 was its second-biggest single-day percentage point fall on record.
Nearly $470 billion has now been lost from the local market since it hit an all-time high of 7,289.7 points on February 20.
Financial stocks were again pummelled by investors looking to quit shares for cash with the prices of the big four banks driven down to 2011 levels.
The yield on the 10 year US bond fell to a new all-time low of 0.38% and was trading around 0.52% on Tuesday. Aussie 10 year bonds were around 0.61% after falling under 0.60%.
Australian 10-year bonds saw their yield fall to around 0.61% at the close but were down around 0.59% during the day.
The Aussie dollar touched a new multi-year low of 63.13 in trading but scrambled back above 65 US cents, peaking at 66.85 before easing back to trade around 65.86 US cents.
At the end of the day, 173 companies were lower while only three were higher – Fisher & Paykel Healthcare, Newcrest Mining, and Spark Infrastructure.
Oil stocks were up for sale as the oil price dropped more than 20%. (see separate story).
US bank stocks were hit, and so were those in Australia.
Westpac shares plummeted 8.6% to $19.52, ANZ Bank shares plunged 8.5% $20.27, National Australia Bank shares dropped 8.5% to $20.14, and Commonwealth Bank fell 6.5% to $69.15, the lowest since early 2019 (and a clear sign investors think it remains best placed of all the banks).
Westpac close at $19.52 was the lowest price since mid-2009. National Australia Bank shares fell to the lowest price since 2009.
Iron ore prices fell 3% for 62% Fe fines delivered to northern China. The Metal Bulletin said the price Monday was $US87.96, down $US2.33 a tonne. Along with oil’s fall, that’s more pressure on local shares on Tuesday.
