European shares slump following Asia lower; ASX drops $48bn in value as coronavirus fears hit

Markets dive, with the 2.25 per cent drop for the S&P/ASX 200 the second-worst fall of the past 12 months.

South Korea reported 161 more coronavirus cases on February 24, taking the nationwide total to 763 and making it the world's largest total outside of China. Picture: AFP

Europe’s share markets took a major hit in early trade on Monday night (AEDT), following Asian markets lower on fears of the coronavirus contagion worsening.

Britain’s FTSE 100 sank 3.3 per cent as trading opened, while the CAC 40 in Paris lost 3.7 per cent and Germany’s DAX fell 3.5 per cent.

New York markets looked set for a downbeat start, with the futures for the Dow Jones Industrial Average down 2.2 per cent and the S&P 500 futures lost 2.4 per cent.

Shares in Italy plunged more than 4 per cent after a spike in cases of the virus left parts of the country’s industrial north in virtual lockdown. That put Milan on course for its worst day since 2016.

The price of gold, viewed as a safe haven in times of peril, jumped $US33.70 to $US1682.40 per ounce.

Benchmark US crude lost $US1.64, or 3.1 per cent, to $US51.74 a barrel in electronic trading on the New York Mercantile Exchange.

Major rout

Local stocks opened sharply lower on Monday and kept going down throughout the day, as global markets become more worried about the spread of coronavirus.

The 2.25 per cent drop for the S&P/ASX 200 marked the second-worst fall of the past 12 months and wiped $48bn off the value of shares.

Local earnings season has entered its last week, with results from BlueScope, Reliance, Worley, Amaysim and Viva, among others. A number of stocks including Wesfarmers, Woodside and Ansell traded ex-dividend.

The ASX 200 dropped 160.7 points, or 2.25 per cent, to 6978.3, and the ASX All Ordinaries was down 165 points, or 2.28 per cent, to 7065.4 at the close.

The moves lower were echoed in markets in Asia. Hong Kong’s Hang Seng dropped 1.8 per cent to 26,820.88 and Thailand’s SET index lost 2.5 per cent. India’s Sensex lost 1.2 per cent to 40,689.12. Benchmarks in Jakarta, Taiwan and Singapore fell by more than 1 per cent. Japan’s markets were closed for a holiday.

The Aussie dollar was 0.42 per cent weaker against the US dollar, buying US65.99c.

“It’s a wipeout today,” said Australian Stock Report senior analyst Ben Le Brun. “It’s a real bloodbath. There was quite the stampede for the exits today.”

The ASX’s energy sector was the hardest hit, falling 4 per cent, as ex-dividend Woodside Petroleum dropped 6.4 per cent, Santos dropped 3.3 per cent and Cooper Energy dropped 5.6 per cent after reporting an underlying first-half net loss of $2m.

The tech, consumer discretionary and industrials sectors all fell more than 3 per cent.

Reliance Worldwide was the biggest ASX 200 loser, dropping 26.5 per cent to a six- month low of $3.42 after the plumbing fixture manufacturer missed half-year sales targets and downgraded its full-year guidance by around $10m.

Ardent Leisure fell 16.3 per cent to a two-month low of $1.18 after a Queensland coroner referred the October 2016 Thunder River Rapids accident at Dreamworld to the Queensland Office of Industrial Relations for possible prosecution.

In the heavyweight mining sector, BHP dropped 3 per cent to a two-month low of $37.09, while Rio Tinto fell 2.5 per cent to a two-month low of $95.26.

Goldminers were the only gainers as the price of the precious metal rose another per cent to $US1660 an ounce - its highest price since January 2013.

Newcrest gained 5.1 per cent, Saracen rose 7.4 per cent, Regis Resources climbed 4.4 per cent and Northern Star was up 3.3 per cent.

New Zealand broadband company Chorus also shone, rising 5.6 per cent to an record high of $6.42 after reporting first-half profit had risen 3.3 per cent.

Viva Energy gained 1.1 per cent to $1.91 after announcing it would return all of the $680m it made through the sale of its stake in Viva Energy REIT to shareholders via an off-market share buyback.

Childcare provider G8 Education fell 5.2 per cent to $1.73 after cutting its dividend on a 13 per cent slump in full-year profit.

Health insurer NIB dropped 7.1 per cent to $4.95 after a rise in claims caused a 23 per cent drop in first-half profit.

Crown Resorts lost 6.2 per cent to $11.03 after a public inquiry into NSW’s casinos resumed with more testimony from expert witness Paul Bromberg.

BlueScope Steel dropped 7.9 per cent to a four-month low of $12.63 after reporting a 70 per cent plunge in first-half net profit after falls in steel prices.

Outdoor advertiser oOh!media declined 3.4 per cent after announcing unprecedented media market softness had caused full-year profit to drop by nearly a third. Looking forward, Mr Le Brun said he thought the fundamentals of the Australian market remained strong and the dip would be a buying opportunity.

Even with the sell-off the ASX remains up 4.4 per cent for the year.

with AP, AAP