Aussie stocks slump to worst day in four weeks ahead of US election
The Australian stock market has slumped heavily in today's trade, following in the footsteps of Wall Street as it posted the worst day in a month.
At close the benchmark S&P/ASX 200 finished down 104 points or 1.7 per cent, despite a number of good news financial stories such as Melbourne easing more COVID-19 restrictions.
Technology stocks suffered sharply, with well-known buy-now, pay-later service Afterpay falling 4.7 per cent and fintech company Zip falling 5.35 per cent.
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The ASX 200 slumped to its worst day in a month. Google Finance
Travel company Flight Centre plunged 4.93 per cent, as did poker machine maker Aristocrat Leisure which fell 4.74 per cent.
The Aussie stock market followed American markets lower, which took a dive overnight as coronavirus, Washington intransigence and earnings weighed on the market.
The Dow closed down 650 points, or 2.3 per cent, after falling as many as 965 points at its low point. All Dow stocks closed in the red except Apple, which eked out a .01 per cent gain. It was the Dow's worst day since September 3.
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The ASX 200 slumped during trade despite positive news. AAP
The S&P 500 - the broadest measure of the US stock market - closed down 1.9 per cent, making it the index's worst day since late September.
The tech-heavy Nasdaq Composite, which had briefly bounced back from its lows in the morning, finished down 1.6 per cent.
Energy, industrials and financials stocks are the among the worst performers of the day.
Those sectors that are more sensitive to the economy and the pace of the recovery felt more pain Monday, said Eric Freedman, CIO at US Bank.
But there were losses across all sectors.
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Outside the Wall Street stock exchange, which fell heavily overnight. AP
What's the deal with this selloff?
There's a lot for investors to grapple with: The election is only eight days away, Congress hasn't reached a deal on a new stimulus package and the first look at how the economy fared in the third quarter will be reported on Thursday.
Big Tech companies will report earnings this week as well, including Microsoft, Apple, Google, Facebook and Twitter.
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A trader rubs his eyes after a hard day on stocks. AP Photo/Richard Drew
While earnings will inject volatility in the tech sector, "on a more macro level, ongoing US stalemate over US fiscal stimulus and the rapidly spreading Covid-19 is going to determine the direction for the wider markets," said Fawad Razaqzada, market analyst at Think Markets, in a note.
The ever-slimming chance of a new stimulus package before next week's election isn't a new factor for the market.
And yet it has been a big driver of the action over the past weeks, even as nothing has really changed as a result of recent negotiations.
- Additional reporting by CNN
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