A horror week for Australian investors worsened this morning as the local market joined Wall Street in a technical correction.
The ASX 200 dived 231 points or more than 3 per cent in the first half hour of trade to extend its dramatic slide since last Thursday's record peak to 736 points or almost 10.3 per cent. The benchmark index trimmed its loss to 173 points or 2.6 per cent by mid-session but remained on track for its worst weekly loss since the GFC.
Overnight, Wall Street entered correction territory, defined as a decline of 10 per cent from a high. The S&P 500 plunged 138 points or 4.42 per cent to its lowest level sine October. The Dow's 1,191-point loss was its largest ever in a single session.
US index futures have proved a treacherous guide to overnight action this week, but this morning mounted yet another rally. S&P 500 index futures were recently ahead 11 points or 0.4 per cent.
At half-time, just 11 companies were trading higher on the ASX 200, with Nextdc the best performer with a rise of 3.4 per cent. Only four companies were ahead more than 1 per cent. The rest of the index made grim reading, with gold miners filling most of the bottom slots. Silver Lake Resource fell 13.1 per cent, Gold Road Resource 13 per cent and Resolute Mining 8.8 per cent.
Harvey Norman sank 9.1 per cent after a summer of bushfires and floods on the east coast helped knock the retailer's first-half profit down 4.1 per cent to $213.6 million. Afterpay skidded 7.5 per cent after warning yesterday or higher costs as the buy-now-pay-later leader pushes into Canada.
Sector analysis brought little comfort, with health the pick with a loss of 1.5 per cent and materials the biggest loser with a fall of 3.8 per cent. Signs in the last two sessions that iron ore was belatedly succumbing to the downtrend in commodity prices helped send BHP to its lowest level in more than a year. The Big Australian sank 3.4 per cent, Rio Tinto 3 per cent, Newcrest 6.2 per cent and Woodside 2.9 per cent.
Westpac was the first of the big four banks to hit a 12-month low, falling 2.4 per cent to a level last seen in December 2018. CBA shed 2.9 per cent, ANZ 2.7 per cent and NAB 3.1 per cent. Insurer IAG fell 2.6 per cent to its weakest point since September 2017.
Asian markets continued to haemorrhage. China's Shanghai Composite gave up 1.63 per cent, Hong Kong's Hang Seng 2.16 per cent and Japan's Nikkei 3.34 per cent.
Oil extended its overnight 14-month low. Brent crude futures declined 82 cents or 1.6 per cent this morning to $US51.36 a barrel. Gold edged up $2.60 or 0.15 per cent to $US1,645.10 an ounce.
The dollar dipped 0.06 per cent to 65.64 US cents.
What's hot today and what's not:
Hot today: Shareholders in mining minnow Antipa Minerals (ASX:AZY) had something to smile about on a day of market gloom after finding themselves in bed with gold giant Newcrest. Antipa announced it had sealed a $60 million deal for Newcrest to fund exploration at AZY's Wilki Project in WA. Under the farm-in agreement, Newcrest will spend $6 million over the next two years at the site, which is close to Newcrest's Telfer mine and Rio Tinto's Winy deposit. Antipa's share price rose 36.4 per cent on a day when significant gains were rare.
Not today: Gold stocks endured their worst session in at least a year, with the S&P/ASX Gold Index lately down an astonishing 8.1 per cent. Perseus Mining dived 18.2 per cent, Ramelius 15.1 per cent and Silver Lake Resource 13.4 per cent. All at a time when gold is hovering just shy of a multi-year high. So what gives? Firstly, analysts say that while gold is a safe haven, gold stocks are not. Investors will often sell their best-performing assets. Secondly, just as a rising tide raises all ships, a sinking tide has the opposite effect. Thirdly, margin calls. The speed of this retrace has caught out many investors using borrowed money, meaning forced sales.