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Market bears were back in control this morning, sending the ASX lower for a second day despite unexpectedly robust jobs data.

At the halfway mark, the S&P/ASX 200 was off 69 points or 1.3 per cent at 5398 after earlier falling as much as 122 points. The market pared losses after the mid-morning release of a report showing the jobs market defied expectations of a sharp downturn last month.

Data compiled by the Australian Bureau of Statistics showed the economy added a seasonally-adjusted 5,900 new positions last month and the jobless rate ticked up a mere tenth of a percentage point to 5.2 per cent from 5.1 per cent in February. Economists had anticipated a far sharper jump in unemployment to 5.4 per cent and an overall loss of more than 30,000 positions. However, economists warned against reading too much into the data, which was collected over the first two weeks of the month before business lockdowns truly kicked in.

“Today’s data shows some small early impact from Covid-19 on the Australian labour market in early March, but any impact from the major Covid-19-related actions will be evident in the April data,” ABS chief economist Bruce Hockman said.

Today’s market retreat followed sharp losses on Wall Street overnight as investors responded to dire US economic data and bank earnings. The S&P 500 sank 63 points or 2.2 per cent. US Index futures continued to decline this morning. S&P 500 index futures were recently down 15 points or 0.5 per cent.

Ten of eleven ASX sectors declined, led by falls of 2.3 per cent in financials and 1.9 per cent in materials and consumer discretionary. The consumer staples sector bucked the trend with a rises of 1.3 per cent.  

Investors turned to defensive assets, lifting Woolworths 2 per cent, Coles 0.4 per cent and IGA wholesaler Metcash 2 per cent. Pharmaceutical company Mayne Pharma drove gains in the health sector, surging 5.8 per cent to be one of the index’s top performers after announcing it had applied in the US for approval to release a new oral contraceptive for women. Fisher & Paykel Healthcare rallied 4.6 per cent and ResMed 0.8 per cent.

Investors turned on companies most exposed to the economic impact of the pandemic. Business travel provider Corporate Travel Management slumped 13.1 per cent, travel agent Flight Centre 10.2 per cent, UK banking group Virgin Money 9.7 per cent and European shopping centre owner Unibail-Rodamco-Westfield 7.6 per cent.

Among the index heavyweights, BHP fell 2.5 per cent, Rio Tinto 1.5 per cent, CBA 2.4 per cent, ANZ 2 per cent, NAB 2.9 per cent and Westpac 3.4 per cent.

Most Asian markets tracked Wall Street lower. Hong Kong’s Hang Seng dropped 0.6 per cent and Japan’s Nikkei 1.2 per cent. China’s Shanghai Composite edged up 0.3 per cent,

Brent crude bounced 84 cents or 3 per cent this morning to $US28.53 a barrel. Gold rose $3.52 or 0.2 per cent to $US1,743.40 an ounce.

The dollar fell 0.4 per cent to 62.91 US cents.

What’s hot today and what’s not:

Hot today: The crowded race to find treatments for Covid-19 gained a new entrant after Starpharma Holdings (ASX:SPL) announced its antiviral compound was highly active against the virus. The company said its SPL7013 antiviral derimer performed well in laboratory studies by inhibiting the infection of cells with the virus. CEO Jackie Fairley said, “We are now exploring a number of product opportunities, including a potential preventative application… Such a product could provide additional personal protection for those in the front line of this crisis, such as doctors, nurses and other essential workers.” SPL’s share price shot up 23.7 per cent.

Not today: News of a delay in mine expansions helped send shares in Whitehaven Coal (ASX:WHC) down 7.5 per cent. The company reaffirmed its full-year guidance but said it did not intend to green-light this year three development projects it expects to underpin earnings over the next decade. In a statement the company said, “While coal markets in the March quarter have demonstrated their resilience, volatile financial market conditions cause Whitehaven to continue to be cautious in allocating capital to expansion. Whitehaven does not expect to consider making a Final Investment Decision in relation to these projects in 2020.”

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