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A fire scare at Europe’s largest nuclear power plant drove the share market down almost 1.8 per cent before a partial recovery after the threat was downgraded.
The S&P/ASX 200 finished 40.6 points or 0.57 per cent lower.
Uranium miners trimmed heavy falls that helped drag the index down 126 points in a late-morning “flight to safety”. Defensive assets, including gold miners and supermarkets, rallied.
What moved the market
Panic swept financial markets mid-morning after Ukraine’s Foreign Minister reported a fire at the Zaporizhzhia nuclear plant as Russian troops attacked.
“If it blows up, it will be 10 times larger than Chornobyl!” tweeted Dmytro Kuleba.”Russians must IMMEDIATELY cease the fire, allow firefighters, establish a security zone!”
Stocks recovered after later reports confirmed the fire at the plant was contained to a training building and presented no immediate threat to the reactors. Radiation levels were normal. Ukrainian emergency services reported the fire was extinguished shortly before the ASX closed this afternoon.
Uranium stocks finished firmly lower after bearing the brunt of the morning sell-off. Paladin Energy dived 14.53 per cent. Deep Yellow shed 17.02 per cent, Elevate Uranium 14.96 per cent and Bannerman Energy 16 per cent. Lotus Resources gave up 16.13 per cent, Boss Energy 15.93 per cent and Toro Energy 15.79 per cent.
US futures also declined. S&P 500 futures fell 38 points or 0.86 per cent.
Despite today’s setback, Australian stocks outperformed US and European markets during a volatile week on financial markets. The ASX 200 scored a weekly gain of 113 points or 1.6 per cent, supported by major gains in commodity stocks.
Overnight, Wall Street ended lower as traders fretted about the risk of “stagflation”, a situation where inflation increases while economic growth stagnates. The combination undermines traditional policy tools because addressing one problem inflames the other.
The S&P 500 dropped 0.53 per cent. The Nasdaq Composite slid 1.56 per cent.
“All eyes are now glued to the jobs report for February due tonight, which could show a sturdy increase in employment as Omicron-related concerns subside in the US. Speculations are rife that workers’ return to the workforce and increased hiring could spur job numbers in February amidst a deep decline in Omicron cases,” Kalkine Group CEO Kunal Sawhney said.
“It is worth noting that the upcoming jobs report is the final monthly employment data that will be considered by the Fed in its March meeting.”
While Wall Street has been choppy this week, the trend on European markets has been firmly negative. Overnight, the pan-European Stoxx 600 fell 2.01 per cent to its weakest close since last May. Germany’s DAX index ended at a 13-month low.
Winners’ circle
Agribusinesses rallied early with grain prices. Elders added 1.18 per cent. GrainCorp gave up early gains, easing 0.34 per cent. Overnight, wheat extended its weekly advance to 31.9 per cent. Corn and soybeans have also seen strong price gains.
“Wheat prices are trading at levels last seen in 2008, at the height of the Global Financial Crisis,” Tiger Brokers’ Chief Strategy Officer Michael McCarthy said.
Piedmont Lithium rose after business partner Sayona doubled the estimated mineral resources at its lithium projects in Quebec. Piedmont jumped 6.67 per cent. Sayona finished unchanged.
Gold miners rebounded with a flight to safety. Newcrest gained 2.76 per cent. Gold Road Resources firmed 2.48 per cent, Perseus 3.12 per cent and Silver Lake Resources 2.14 per cent.
The day’s other best performers were Cromwell Property +2.35 per cent, Incitec Pivot +2.18 per cent and Atlas Arteria +2.06 per cent.
CSL inched up 0.31 per cent after tightening its grip on Swiss giant Vifor Pharma. A public tender offer period ended with 74 per cent of Vifor shares in CSL’s hands. The biotech said the transaction was on track to complete on schedule by mid-year.
Doghouse
Payments companies came under pressure as growth stocks felt the heat from a retreat from risk. Afterpay’s US parent company Block’s ASX listing fell 9.23 per cent. Sezzle dropped 6.79 per cent, Zip Co 8.02 per cent and EML Payments 5.95 per cent.
Oil producers finished mixed near multi- month highs after a Ukraine war-fuelled rally in commodity prices showed the first hint of stress. Brent crude finished 2.2 per cent lower overnight at US$110.46 a barrel after peaking just below US$120.
Santos shed 1.02 per cent and Beach Energy 0.89 per cent. Woodside Petroleum reversed to a gain of 0.26 per cent.
Junior gold miner Wiluna dipped 6.67 per cent after suspending all shipments of gold concentrate to Russia. The miner said it had made arrangements to sell to other destinations.
Other markets
Asian markets logged heavy falls. The Asia Dow per cent slumped 1.88 per cent, China’s Shanghai Composite 0.66 per cent, Hong Kong’s Hang Seng 2.67 per cent and Japan’s Nikkei 2.44 per cent.
Brent crude bounced US$1.74 or 1.58 per cent to US$112.20 a barrel.
Gold climbed US$6 or 0.3 per cent to US$1,941.90 an ounce.
The dollar rallied 0.3 per cent to 73.58 US cents.
