The Australian market plunged sharply on Friday, on global economic concerns after weaker than expected jobless claims in the US and sovereign debt concerns in Greece triggered sell-off in Europe and US markets in the previous session. Sharp decline in commodity prices, including gold and oil, as well as strengthening of the US dollar against the Euro also impacted global stock markets. Almost all the stocks witnessed sell-off in the market resulting in loss in excess of A$30 billion in today's trading session.
The benchmark S&P/ASX200 Index plunged 107.50 points, or 2.33% to close at 4,514, while the All-Ordinaries Index ended at 4,533, representing a steep loss of 111.60 points, or 2.40%.
On the economic front, the Reserve Bank of Australia, releasing the quarterly Monetary Policy Statement, predicted modest increases in inflation and GDP in the country, apart from slight moderation in joblessness. The central bank stated that it would resort to more interest rate hikes if any or all of its forecasts materialize. The apex bank expects inflation to ease from 3.25% through 2009 to 3% by middle of 2010 and to 2.5% by the end of the year. RBA earlier projected inflation rate of 2.25% for 2010. The bank further noted that it expects inflation to rise to 2.75% by the end of 2011 and into 2012.
In a separate statement, the Reserve Bank of Australia stated that the country's official reserve assets totaled A$46.58 billion in January, slightly higher than A$46.51 billion reported for December. The bank further stated that the value of official reserve assets increased by A$69 million primarily due to earnings. Of the total official reserve assets of the country, foreign exchange stood at A$36.84 billion, larger than the A$36.79 billion in December. Special Drawing Rights increased to A$5.41 billion from A$5.39 billion in the prior month. Reserves with IMF came in at A$1.21 billion and gold reserves totaled A$3.11 billion.
Light sweet crude oil futures for March delivery ended at $73.35 a barrel in electronic trading, up $0.21 per barrel from previous close at $73.14 a barrel in New York on Thursday.
Metals and mining stocks declined sharply on lower commodity prices in the international market. BHP Billiton lost 3.51%, Rio Tinto plunged 5.02%, Fortescue Metals fell 5.45%, Gindalbie Metals shed 4.74%, Macarthur Coal declined 5.55%, Minara Resources backpedaled 4.58% and Oz Minerals slumped 6.25%.
Gold stocks slumped after bullion prices declined sharply in the international market. Lihir Gold shed 4.20% and Newcrest Mining fell 2.56%.
Oil stocks also ended in negative territory. Woodside Petroleum declined 3.89%, Santos fell 4.07%, Oil Search plunged 5.32% and Origin Energy slipped 1.34%.
Banks also ended sharply lower amid global economic concerns. ANZ Bank fell 2.43%, Commonwealth Bank of Australia edged down 0.53%, National Australia Bank fell 2.16% and Westpac Banking lost 2.25%. Investment banker Macquarie Group plunged 5.60%.
Healthcare stocks bucked the weak sentiment in the market. CSL Ltd gained 1.38% and Sonic Healthcare advanced 1.05%.
In the U.S., stocks recorded substantial losses on Thursday, as concerns over continued high levels of jobless claims and spreading European credit issues weighed on the markets. With the pullback, the major averages all finished firmly in negative territory, setting three-month closing lows ahead of tomorrow's landmark employment report. The Dow fell by 268.37 points or 2.6% to 10,002, the Nasdaq declined by 65.48 points or 3% to 2,125 and the S&P 500 slid by 34.17 points or 3.1% to 1,063.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.