Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Australian shares tumble as firmer bond yields, fall in tech stocks weigh

Published 26/02/2021, 05:14 pm
Updated 26/02/2021, 05:18 pm
© Reuters.

© Reuters.

* Australian cenbank announces unscheduled bond purchase

* Tech stocks drop tracking Wall Street peers

* New Zealand snaps six sessions of losses (Updates to close)

By Soumyajit Saha

Feb 26 (Reuters) - Australian shares closed at their lowest level in nearly a month on Friday, with tech stocks leading the declines, as risk assets lost their sheen after global bond yields firmed on expectations of economic expansion and rising inflation.

The S&P/ASX 200 index .AXJO ended 2.4% lower at 6,673.3, marking its sharpest fall since Sept. 4, 2020. For the week, the index shed 1.8%.

Yields on Australian and global bonds continued to rise, prompting the Reserve Bank of Australia to launch an unscheduled offer to buy three-year government bonds. central bank's monthly meeting on Tuesday will also be closely watched for comments on the volatility from the bond sell-off, but we don't expect any major policy changes," said Steven Daghlian, market analyst with CommSec.

Higher bond yields make equities look less attractive as they diminish the lure of stocks' dividend payouts, and make debt servicing harder for companies.

Tech stocks .AXIJ dived 5.3% and lost 12.8% over the week, mirroring a downturn in their Wall Street peers, with fintech co Afterpay Ltd APT.AX dropping 11%. stocks .AXEJ skid 2.5%, hurt further by a fall in oil prices. O/R

Oil & gas explorers Woodside Petroleum WPL.AX and Oil Search OSH.AX lost 3.4% and 2.1%, respectively.

Miners .AXMM fell 2.1% despite higher metal prices, with BHP Group BHP.AX and Fortescue Metals Group FMG.AX shedding 2.6% and 4.5%, respectively.

Financials .AXFJ also slid, with the so-called "Big Four" banks falling between 2% and 2.6%.

Commercial explosives maker Orica ORI.AX was the biggest percentage loser on the benchmark index after it said the trade spat between Australia and China will hit its sales to thermal coal mining customers. New Zealand, the benchmark S&P/NZX 50 index .NZ50 snapped a six-session losing streak to end 0.7% higher, helped by gains among utility and industrial stocks.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.