ASX takes massive opening dive after Wall Street chaos

A financial bloodbath on Wall Street set the scene for a dramatic Australian sharemarket dive on Thursday morning, with the index shedding billions of dollars.

The Australian sharemarket took a cue from last night’s Wall Street bloodbath with a dramatic early nosedive on Thursday, erasing a lot of the progress made over the previous four sessions.

The benchmark ASX 200 fell by as much as 2 per cent after inflation fears and poor earnings figures battered the major US indices, handing Wall Street traders their worst session since 2020.

The benchmark ASX 200 fell by as much as 2 per cent on Thursday morning, erasing a lot of the progress made over the previous four sessions. Picture: NCA NewsWire / James Gourley

The Dow Jones dropped 3.6 per cent, the S&P500 fell 4 per cent, and the Nasdaq tumbled 4.7 per cent, which was more than enough to set the ASX 200 up for a poor morning.

There was nowhere to hide on local shores with all sectors firmly in the red late in the morning.

The market was 1.8 per cent lower at 7055.6 by 11.20am AEST and back where it was on Friday.

Big consumer names such as Wesfarmers, Woolworths, and Coles each fell by more than 5 per cent while technology stocks, mining companies, and the big banks were also badly affected.

JB Hi-FI, Harvey Norman, Super Retail Group, Flight Centre and IGA supplier Metcash were also in the dumps.

The ASX is expected to be shaken up on Thursday. Picture: NCA NewsWire / Damian Shaw

Traders had been clawing back lost ground in recent days after a dire cocktail of inflation fears, rate hike expectations, and Chinese Covid-19 lockdowns knocked the index to multi-month lows.

Tech stocks helped the local market gain 70.2 points, or 0.99 per cent, on Wednesday to close at 7182.7 points.