Finance Finance News Australian shares slide toward 22-month low

Australian shares slide toward 22-month low

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Retail sales at cafes, restaurants and takeaway food outlets dipped as people chose to stay home rather than eat out. Photo: Getty
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The Australian dollar lost further ground on Thursday and the share market closed just above a 22-month low on more signs the economy remains weak.

The S&P/ASX 200 index ended the trading session 10.8 points, or 0.2 per cent, lower at 5657.6 after an early drop of 0.6 per cent.

The benchmark index has now dropped 10.9 per cent from its peak of 6352 on August 29, including 4.7 per cent over the past three weeks alone.

The Australian Bureau of Statistics reported on Thursday that retail sales rose 0.3 per cent in October – in line with economists’ expectations. However, September’s change was revised downward to an anaemic 0.1 per cent, from 0.2 per cent first reported.

A recovery in clothing, footwear and personal accessories led the retail sales category rises, with a jump of 2.6 per cent.

ABS director of quarterly economy-wide surveys Ben James said sales gains were also recorded in household goods, up 0.6 per cent, department stores (0.4 per cent) and food retailing (0.2 per cent).

However, they were offset by weakness in sales at cafes, restaurants and takeaway food. These declined 0.9 per cent as people chose to stay home rather than eat out.

The Australian dollar, which posted a sharp decline of 1 per cent on Wednesday after the release of weak national accounts numbers, fell slightly to hit a fresh one-week low of US72.26 cents.

“We expect the Australian dollar to continue to be mainly driven by external developments in the coming months,” Lee Hardman, a currency analyst at MUFG, said.

“The worst-case outcome for the currency would be break down in US-China trade talks that leads to the imposition of further tariffs and exacerbates the slowdown in global growth.”