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Australia shares slip on rising virus death toll

Published 26/08/2020, 05:02 pm
Updated 26/08/2020, 05:06 pm

(Updates to close)

* Stimulus, vaccine hopes limit losses

* Gold stocks slip for sixth session

* NZ rises for fourth straight session

By Arpit Nayak

Aug 26 (Reuters) - Australian shares snapped two straight sessions of gains on Wednesday as risk sentiment was hit by the rising coronavirus death toll in the country's second-most populous state, although additional stimulus and hopes for a local vaccine capped losses.

Victoria recorded its second-deadliest COVID-19 daily death toll on Wednesday, while the state government's intention to extend a state of emergency by another year also weighed on the market. S&P/ASX 200 index .AXJO settled 0.7% lower at 6,116.4 after declining 1.3% in intraday trade.

"We are sort of in the eye of the storm and there is more bad weather coming for the Australian economy," said Brad Smoling, Managing Director at Smoling Stockbroking.

"The only saviour will be some of the commodities, the rest of the economy is really suffering."

The benchmark stock index cut some of its losses after the government announced fresh stimulus by way of A$1 billion ($719.20 million) in defence spending to grow the military and support employment. that local researchers could start human trials of a coronavirus antibody therapy in early 2021 and a large-scale trial of a vaccine could begin by the end of this year also supported the partial recovery late in the session.

Financials .AXFJ led the decline on the benchmark, with top lenders Commonwealth Bank of Australia CBA.AX and Westpac Banking Corp WBC.AX easing 1.1% and 1.3%, respectively.

Saracen Mineral Holdings SAR.AX lost 2.3% and Evolution Mining EVN.AX gave up 1.4% as the gold sub-index .AXGD slipped for a sixth straight session.

BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX were the top losers among heavyweight miners .AXMM .

New Zealand's benchmark S&P/NZX 50 index .NZ50 ended 0.3% higher at 12,031.51, marking its fourth straight session of gains, with Meridian Energy MEL.NZ up 1.6% while Fisher & Paykel Healthcare Corp FPH.NZ added 2%.

($1 = 1.3904 Australian dollars)

Latest comments

26Aug2020 - What a load of old codswallop. Most intelligent Australian’s actually understand that the peak in covid19 deaths will lag the peak in new cases by up to four weeks and the current death rate (deaths vs recorded cases) is in keeping with that of the rest of the country. Which is well under the death rate in the US and the rest of the world. As for the drop in the Oz market today its been doing the same sideways zig zag for several weeks now. It’s indecisive based on a number of unresolved issues and of course it’s earning season in Australia and we are down to the dregs of covid 19 affected companies. A lot of bad news in the medium to low caps.B JonesAdelaide, Sth Aust
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