Finance Finance News Australian shares tumble following Dow Jones’s 660-point drop

Australian shares tumble following Dow Jones’s 660-point drop

After the Dow Jones tumbled, the Australian share market followed suit with its own sharp fall. Photo: Twitter
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Australian shares have tumbled after Apple’s worst trading day in six years sparked a sell-off in global markets.

The benchmark ASX 200 had lost 0.9 per cent to 5,584 at 1.05pm (AEDT), after recovering from a steeper 1.1-per-cent drop in early trade.

The broader All Ordinaries index fell by a similar level to 5,643 points.

Since its recent peak in late-August, the local market has plummeted by about 12 per cent – as investors grow increasingly concerned about an unresolved trade war, slowing global economic growth and the United States raising interest rates too quickly.

Pessimistic global forces

Apple’s rare profit downgrade caused its share price to plunge 10 per cent, and was the latest trigger for the market meltdown.

The world’s largest technology company warned investors first-quarter earnings would be 10 per cent lower than expected because of poor sales in China.

Apple chief executive Tim Cook blamed the slowing Chinese economy and, “rising trade tensions with the United States”.

Market sentiment also worsened after the US, China and European Union released worse-than-expected factory figures earlier this week.

Their figures all showed manufacturing activity – namely their purchasing managers indices (PMI) – had fallen to their lowest levels in around two years.

These were further signs America’s tariffs on foreign steel and aluminium and the billions of dollars in US-China tit-for-tat tariffs were inflicting pain on the world economy.

Heavy losses in most sectors

Almost every sector is in negative territory, with technology (-2.7pc), healthcare (-1.8pc), industrials (-1.4pc) and consumer staples (-1.5pc) being the worst performers.

Graincorp (-2.2pc), Macquarie Group (-1.4pc) and Coles (-1.7pc) are some of the big-name stocks which have sustained heavy falls.

Mining giants Rio Tinto (-1.3pc) and BHP (-1.4pc) have narrowed their losses, though are still a significant drag on the broader market.

Also having a significant impact are the big four banks – ANZ (-0.5pc), Commonwealth Bank (-0.5pc), Westpac (-0.3pc) and NAB (-0.1pc) – which also recovered from steeper losses earlier in the session.

More to come.