Australian share market drops as global oil prices plunge

A drop in global oil prices has hit the Australian share market, pushing the benchmark lower on Friday with energy stocks sliding 1.6 per cent.

The Australian share market edged lower on Friday after energy stocks weighed heavily on the benchmark as oil prices plummeted overnight on fears of falling US and Chinese demand.

The S & P/ASX200 lost 0.1 per cent, or 9 points, to close at 7,049.4, while the All Ordinaries fell by a similar amount to 7,261.

In weekly terms, the local benchmark added 1.1 per cent.

The Australian dollar is buying US64.71¢.

Global oil prices plunged overnight on investor fears of falling demand. Picture: AFP / Frederic J. Brown.

Across the benchmark, four of 11 industry sectors finished in the green, with industrial stocks the best performers. Energy stocks were the worst performers, sliding 1.6 per cent, led by discretionary and utilities, which both fell 1 per cent.

A plunge in global crude oil prices, which pushed Brent Crude to $US77.50 a barrel, saw oil producers tumble. Sector heavyweight Woodside fell 2.3 per cent to $31.40, Ampol dipped 1.8 per cent to $33.55, and Beach lost 0.3 per cent to $1.52.

Iron ore miners led the gains, after commodity futures rose amid signs of improving steel demand due to a rebound in the Chinese economy.

Rio Tinto added 0.4 per cent to $125.62, BHP climbed 0.1 per cent to $46.61 and Fortescue edged 0.1 per cent higher to $25.22.

Iron ore miners rose after signs of a rebound in the Chinese economy. Picture: AFP

The big four banks, with the exception of Commonwealth Bank, fell with Westpac sinking 0.2 per cent to $21.10, NAB retreated 0.1 per cent to $27.73 and ANZ lost 0.5 per cent to $24.07.

In company news, shares for insurance broker Steadfast Group dropped 3.3 per cent to $5.23 after it raised $280 million in an institutional placement to fund the purchase of a 70 per cent stake in Sure Insurance, a regional underwriting agency.

Virgin Australia and Air New Zealand asked their respective competition agencies for approval to unite on trans-Tasman routes. Air New Zealand slumped 0.8 per cent to 61.5¢.

Originally published as Australian share market drops as global oil prices plunge