Australia, NZ shares retreat from record highs as virus spreads

Published 21/02/2020, 01:00 pm
© Reuters.  Australia, NZ shares retreat from record highs as virus spreads
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* Benchmark set for third straight weekly gain

* The energy sub-index set to snap five straight weekly losses

* NZ's Fisher & Paykel hits record high on outlook hike

By Sameer Manekar

Feb 21 (Reuters) - Australian shares retreated on Friday from a record close in the previous session as mounting new coronavirus cases in China and other Asian countries intensified fears over its spread and impact on the global economy.

The S&P/ASX 200 index .AXJO was down 0.2% at 7,148.4, as of 0015 GMT, but was on track for a third straight weekly gain.

The epidemic has already disrupted economic growth in China and a further spread to other countries could derail a "highly fragile" projected recovery in the global economy in 2020, the International Monetary Fund warned on Wednesday. Korea reported 52 new confirmed cases of coronavirus on Friday, Yonhap news agency reported, bringing its total to 156 and raising further alarm about the epidemic. of now, 25 other countries have reported 1,076 cases to the World Health Organization.

"Market is starting to realise the impact on supply chains due to the outbreak, and how long and protracted it could be especially if the numbers are greater than what we are being told," Brad Smoling, managing director at Smoling Stockbroking said.

"Even if China was to go back to work tomorrow, it will take a long time for all the supply chains to come back online for the companies to get their production going," Smoling added.

The local mining sector .AXMM weighed on the benchmark, losing as much as 0.4%. Heavyweight miners BHP Group BHP.AX and Fortescue Metals Group FMG.AX lost up to 0.7% and 1.9%, respectively.

Among healthcare stocks .AXHJ , biotech firm CSL Ltd CSL.AX and hearing implants maker Cochlear Ltd COH.AX declined 0.5% and 2.3%, respectively.

The energy sub-index .AXEJ fell 0.6%, but was on track to snap five consecutive weekly losses.

Santos Ltd STO.AX fell up to 1.2%, extending losses into a second session after posting a flat annual profit on Thursday, while Origin Energy ORG.AX lost as much as 1.9%. gainers, the gold sub-index .AXGD advanced up to 0.9%, with heavyweight Newcrest Mining NCM.AX rising 1.6%, as bullion prices hovered near a seven-year peak as nervous investors opted for safe-haven assets. GOL/

Over in New Zealand, the benchmark S&P/NZX 50 index .NZ50 retreated from record close to swing between positive and negative territory, and traded down 0.1% at 12,047.7. However, the index was on track to post a weekly gain of 1.7%, its biggest in five.

Electricity generator Meridian Energy MEL.NZ fell as much as 2%, while Fisher & Paykel Healthcare Corp FPH.NZ hit a record high after raising its full-year earnings outlook.

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