Jitters bug shares
AUSTRALIA’S stock market has notched up its worst week in two years, with jittery investors renewing their sell-down as Wall Street plunges into an official market correction.
The key market index, the ASX 200, dropped another 0.9 per cent yesterday — cancelling out a two-day rebound — after another heavy bout of selling on Wall Street.
Signs that US interest rates will rise more quickly than many investors have been expecting has sparked turmoil on the US stock market, which has spread across the globe.
The local bourse shed 4.6 per cent for the week, stripping $83 billion from the value of the 200 largest listed companies. The ASX 200 closed at 5838 points yesterday.
It was the biggest weekly sell-off since the start of 2016.
This week’s sell-down has been broad-based with virtually all blue-chip stocks dented.
Local investors switched to sell yesterday after the Dow Jones Industrial Average, a key Wall Street index, suffered another 1000-plus point fall.
It was the second-biggest one-day point fall in the index’s history and came on the heels of the record 1175point plunge on Monday.
The combined hits sent Wall Street into its first market correction in two years — a 10 per cent drop in stocks from their peak. The US sell-down has sent investors across the globe scrambling for the exits, with Japanese shares down 10 per cent, China off 9 per cent and the eurozone losing about 8 per cent.
But AMP Capital chief economist Shane Oliver said while the local bourse may still fall further, the sell-off appeared to be a periodic correction, rather than the start of a full-blown crash.