Australian shares are dipping as Disney reports a $1.4 billion loss due to the coronavirus pandemic
The Australian share market has dipped modestly for a second day following a rollercoaster trading day on Wall Street and Disney’s “Magic Kingdom” showing it was vulnerable.
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The Australian share market has dipped modestly for a second day as oil prices slid, even as a surging trade surplus bolstered the mining sector.
The S&P/ASX200 benchmark index finished Thursday down 20.4 points, or 0.38 per cent, to 5,364.2, while the All Ordinaries index was down 14.9 points, or 0.27 per cent, at 5,449.9.
One Australian dollar was buying 64.44 US cents, down from 64.45 US cents on Wednesday’s close.
In the first 30 minutes of trade on Thursday, the S&P/ASX200 benchmark index was down by 30.1 points, or 0.56 per cent, to 5354.5 points.
The All Ordinaries index was 29.3 points lower, or 0.54 per cent, at 5435.5.
The financial and energy sectors were the biggest drags on the market – down 1.19 and 1.61 per cent respectively.
ANZ lost 25 cents, or 1.54 per cent, to $15.95, Commonwealth Bank slipped 84.5 cents, or 1.4 per cent, to $59.50, NAB dropped 31 cents, or 1.87 per cent, to $16.28, and Westpac was down 20 cents, or 1.25 per cent, to $15.76.
Those results came after the S&P 500 and the Dow fell overnight amid declines in financials and defensive groups.
Oil dropped 4.0 per cent overnight to below $US30 a barrel as US crude stockpiles ticked up and diesel inventories swelled.
Among the biggest losers in ASX energy stocks were Oil Search, down 8.0 cents, or 2.71 per cent, to $2.87, and Santos, which lost 10 cents, or 2.06 per cent, to $4.75.
One of the best early performers was engineering, construction and accommodation firm Decmil Group.
Its shares were up 10.26 per cent to 21 cents. Decmil on Monday reported it was trying to negotiate the sale of its hotel in Gladstone in Queensland, which caters to mining workers.
The big miners had mixed results in early trade.
BHP was up 34 cents, or 1.12 per cent, to $30.75, Rio was lower by 8.5 cents, or 0.1 per cent, to $81.90, while Fortescue was down 1.0 cent, or 0.09 per cent, to $11.25.
Insurer NIB’s shares slipped 1.04 per cent to $4.77 after reporting a 22 per cent drop in sales of health insurance in April compared with the same period last year due to COVID-19.
The lost revenue may be offset by fewer claims.
Healthcare was one of a minority of sectors to gain. CSL was up $1.06, or 0.35 per cent, to $307.84.
The telco sector was up slightly too. Telstra shares were 2.0 cents higher, or 0.65 per cent, to $3.08.
The March international trade balance will be published later this morning by the Australian Bureau of Statistics.
Westpac economists expect the surplus to widen to $6.8 billion, led by a sharp rebound in exports.
One Australian dollar buys 63.99 US cents at 1030 AEST, down from 64.45 US cents on Wednesday’s close.
DISNEY’S LOSSES REVEALED AS WALL ST FELL
Disney has reported a more than $A2 billion loss due to the global coronavirus pandemic as share traders on the Australian market braced for a second consecutive morning of early losses after US markets fell.
The benchmark SPI 200 futures contract was down 0.9 per cent – signalling a muted start to trading.
Entertainment behemoth Disney was forced to shutter parks, cruises and experience trips as well as halt production on a number of predicted blockbuster hits, like their new live action Mulan and Marvel’s Black Widow.
The Magic Kingdom’s second quarter profit dropped by 91 per cent to $A750 million – down from $A8.5 billion a year earlier.
Their stock plummeted by more than 2 per cent, despite a jump in revenue last year.
US stocks swung between small gains and losses Wednesday as investors continue to try to untangle data and corporate earnings to determine what the economy might look like in the months ahead.
The S&P 500 finished the day 0.7 per cent lower after a choppy session.
Despite Wednesday’s volatility, US stocks have risen in recent days as investors look toward the continued lifting of stay-at-home orders.
Several states have already begun to reopen their economies and others are formulating plans to do the same. President Trump in particular has been eager to energise the economy, saying Wednesday that the White House coronavirus task force would focus on reopening the country and developing a vaccine.
“The stock market isn’t trading from a standpoint of ‘what have you done for me lately’. It’s trading from a standpoint of ‘what will you do for me later’, and in its mind, what comes later is going to look a lot better than what has come lately,” said market analyst Patrick J O’Hare at Briefing.com.
“That’s why it continues to hold its ground in the face of ugly economic data and downbeat earnings news.”
European stock markets nursed modest losses while Asian indices mostly rose, and oil prices slid.
In other downbeat economic news, the European Commission predicted the eurozone economy would contract by a staggering 7.7 per cent in 2020.
Calling it a “recession of historic proportions”, the EU’s executive said the 19-member single currency zone would then rebound by 6.3 per cent in 2021, in an uncertain recovery that would be felt unevenly across the continent.
The FTSE was down 0.1 per cent in London, the DAX fell 1.2 per cent in Frankfurt, the CAC was down 1.1 per cent in Paris, and the Hang Seng rose 1.1 per cent in Hong Kong.
Originally published as Australian shares are dipping as Disney reports a $1.4 billion loss due to the coronavirus pandemic