A big sell-off in technology shares overnight on Wall Street sparked a somewhat tempered retreat of Australian shares when markets opened this morning.
The benchmark S&P/ASX 200 index was down 63.5 points, or 1.1 per cent, at 5608.3, while the broader All Ordinaries Index was down 68.2 points, or 1.1 per cent.
However, shares recovered a good deal of ground in the afternoon session, with the S&P/ASX 200 index ending the day with a loss of just 29 points, or 0.5 per cent. The All Ordinaries Index finished at 5722, down 0.6 per cent.
The sell-off was far less extreme than in the US, where China trade tensions and a steep decline in major technology stocks caused havoc.
The Dow Jones Industrial Index dropped a hefty 2.5 per cent in New York and the broader S&P 500 index lost 1.8 per cent. The technology heavy Nasdaq Composite Index, which is comprised of heavyweights Amazon, Facebook and many other tech giants, lost 2.1 per cent.
The Nasdaq Composite is now down almost 15 per cent from its record closing high of 8109.69 on August 29.
The leading US technology companies have lost a combined US$1 trillion in market value since reaching their peaks in June.
Shares of Facebook, Apple, Amazon, Netflix and Google’s parent company Alphabet have dropped more than 20 per cent in the worst technology sell-off since the dot-com bust from 1995-2000.
Financial analysts said today’s the somewhat tempered response on the Australian Securities Exchange was because key markets indicators here are less heavily weighted toward technology companies.
However, the big miners, which dominate the major market indicators on the ASX, lost ground.
Following a decline in base metal prices overnight, BHP shares fell 3.1 per cent to $31.64 and Rio Tinto dropped 3.1 per cent to $77.38.
The Wesfarmers share price was down about 27 per cent after it divested supermarket giant Coles from its asset portfolio.
Newly minted Coles shares ended their first day of trading at $12.60.
The share price of the Reject Shop rose 14.8 per cent after the discount retail chain received a $78 million takeover offer.