The Australian sharemarket fell sharply on Monday in response to the US and China ramping up their trade war over the weekend.
By 12.20pm (AEST), the benchmark ASX 200 index had lost 99 points, or 1.5 per cent, to 6425.
The broader All Ordinaries dropped by a similar level to 6516 points.
In dollar terms, the local market shed $30 billion worth of value in just a few hours.
The Australian dollar, meanwhile, tumbled to its lowest value in more than a decade – briefly falling 0.7 per cent to 67.06 US cents before the local market opened.
However, the local currency has since lifted back to 67.31 US cents.
Major escalation of trade war
The latest shots in the trade war were fired when China announced it would impose new tariffs on $US75 billion worth of US products.
US President Donald Trump responded by announcing the US would raise its existing tariffs on US$250 billion worth of Chinese imports to 30 per cent – from the current 25 per cent – beginning on October 1.
At the same time, Mr Trump announced an increase in planned tariffs on the remaining US$300 billion worth of Chinese goods to 15 per cent – up from 10 per cent.
This sent major shockwaves on Wall Street, with the Dow Jones index shedding 623 points, or 2.3 per cent, on Friday (local time).
Meanwhile, the other US indices suffered bigger losses, with the S&P 500 losing 2.6 per cent, and the tech-heavy Nasdaq tumbling by 3 per cent.
Best and worst performers
Despite the sell-off, the Australian market performed better than some of its Asia-Pacific neighbours.
Heavier losses were sustained by Tokyo’s Nikkei (-2.3 per cent) and Hong Kong’s Hang Seng index (-3.2 per cent) – though the Shanghai Composite (-1.1 per cent) fared slightly better.
“No matter which way you cut the cake, it is nearly impossible to construct a bullish, or even neutral scenario for equity markets,” said OANDA senior market analyst Jeffrey Halley.
“With tariff-geddon announcements by both China and the US either side of the Wall Street close on Friday, Asia will face repricing both into equity markets regionally.”
Every sector on the ASX 200 was submerged in a sea of red – with energy (-3.4 per cent), technology (-1.9 per cent) and health care (-1.9 per cent) the weakest performers.
Among the worst-performing stocks were Boral (-19.5 per cent), G8 Education (-16.2 per cent), Pilbara Minerals (-9.8 per cent) and IOOF Holdings (-8.1 per cent).
Only 19 stocks had posted gains – many of them being gold miners such as Resolute Mining (+14 per cent), St Barbara (+9.9 per cent) and Regis Resources (+9.7 per cent).
-more to come