Coronavirus fears rattle investors: Aus shares 1.3% lower at noon

Market Reports

by Anna Napoli

The local sharemarket has tumbled this morning following global bourses lower as the economic and financial impacts of the coronavirus are beginning to bite. Travel stocks have been hit hard, Webjet is down 10 per cent today while Qantas is down 6 per cent, and Sydney Airport is down over 8 per cent. The number of confirmed cases of the deadly virus continues to grow, rattling investors.

China enforced a wider travel ban on the weekend in an effort to prevent the spread of the virus which has now killed 82 people according to the Guardian. The US has raised its travel alert for China to "reconsider travel."

Miners are under pressure as well, with BHP and Fortescue both trading lower.

Broker moves

Citi has downgraded Macquarie Bank to sell from neutral. The broker says the stock is now on unfamiliar ground as earnings momentum is set to slow and the likelihood of another record year looks a difficult proposition to Citi. The target price is $123.50. Shares in Macquarie (ASX:MQG) are trading  1.8 per cent lower at  $143.30.

The S&P/ASX 200 index is 1.3 per cent or 95 points lower at 6995. On the futures market the SPI is 62 points lower.

The Aussie dollar is also trading lower.

Local economic news

Business confidence fell 2 points to a net balance of minus 2 in December the lowest score since mid 2013. Business confidence is likely to have decreased due to the national bushfire crisis over the Summer. 

Company news

Karoon Energy's (ASX:KAR) Stena Forth Drillship has commenced the drilling of the Marina-1 exploration well located in Tumbes Basin, Peru. The drilling operation is estimated to take 30 days and shall drill to approximately 3000 metres subsea. The Stena Forth was chosen because it meets and exceeds all engineering, health, safety and environmental requirements of Karoon, its joint venture partners together with the Peruvian government regulatory requirements.
This is the first well to be drilled in The Marina prospect with a gross prospective resource best estimate of 256 million barrels of oil. Shares in Karoon Energy (ASX:KAR) are trading 2.8 per cent lower at $1.24.

Best and worst performers

The best-performing sector is Healthcare, adding 0.3 per cent, while the worst performing sector is energy losing 3 per cent.

All sectors in the reds except health and utilities.

The best performing stock in the S&P/ASX 200 is Gold Road Resources (ASX:GOR) rising around 3.1 per cent to $1.40, followed by shares in Amcor (ASX:AMC) and Saracen minerals (ASX:SAR).

The worst performing stock in the S&P/ASX 200 is Webjet (ASX:WEB), dropping 10.2 per to $12.90 followed by shares in Oil search (ASX:OSH) and Fortescue Metals (ASX:FMG)

Commodities and the dollar

Gold is trading at US$1,581 an ounce.
One Australian dollar is buying 67.54US cents.