Australian shares tanked over 2% on Friday as investors, who drove a relief rally in the previous session, fretted about the trade face-off between the world’s two largest economies and the fallout from US tariffs on global economic growth.
The S&P/ASX 200 index declined as much as 2.4% to 7,524.50 points by 0016 GMT, after the benchmark surged 4.5% on Thursday following US President Donald Trump’s move to temporarily lower tariffs on many countries.
The benchmark was looking to lose nearly 2% for the week, if losses hold.
Although Trump temporarily paused many of his new tariffs, he further ramped up pressure on China, a major trading partner for Australia, with levies for a total of 145% — when the 20% duty previously imposed is taken into account.
Investors worry that China may once again respond in kind with higher tariffs to match the latest levies imposed by the US Any potential slowdown in the world’s second largest economy from tariffs would be detrimental to local resources-focused stocks, which have high exposure to China, a major consumer of commodities.
Australian mining stocks declined 1.8%.
Heavyweights BHP and Rio Tinto retreated 2.8% and 2.3%, respectively. Fortescue’s shares fell 2.7%.
Energy stocks retreated 3.5% after oil prices declined more than 3% overnight.
The subindex was on track to decline more than 5% for the week.
Top energy companies Woodside Energy and Santos fell 3.5% and 3.6%, respectively.
Australia stocks slide amid global sell-off as trade war escalates
Gold stocks rose 2.2% to hit a fresh all-time high, mirroring the record high in gold prices. Banking stocks declined 2.9%.
Financials were on track to lose 2.7% for the week.
The “Big Four” banks fell between 2.8% and 3.2%.
New Zealand’s benchmark S&P/NZX 50 index fell 1.5% to 12,023.84 points.
New Zealand stocks were heading for a 1.6% fall for the week, in what could be their worst week since early March.
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