Mining stocks led Australian shares to their worst session in over seven months on Monday, with investors slashing riskier positions as the growing trade war between the United States and China revived worries about weaker global growth. The S&P/ASX 200 index closed 1.9%, or 128.3 points, lower at 6,640.3, its fourth session in the red and the largest one-day decline since last December.
Resource stocks, Australia's biggest export sector, bore the brunt of the benchmark's A$37.77 billion ($25.58 billion) loss in market value since Friday's close. (Calculations based on Refinitiv Eikon data). Investors have dumped riskier assets since US President Donald Trump abruptly declared late last week that he would slap 10% tariffs on $300 billion in Chinese imports, snuffing a month-long trade truce and prompting China to warn of retaliation.
China is the biggest buyer of Australian exports. On Monday, the world's no. 2 economy let its currency slide past the key 7-per-dollar level for the first time in more than a decade. The world's biggest miner BHP Group shed 3.6% to close at a near two-month low, while smaller peer Fortescue Metals Group tumbled 7.2%. Heavyweight banking units lost 1.5%, with the "big four" banks giving up between 0.8% and 1.7%.
Australian oil and gas companies also declined, with Santos giving up 2.4%. However, Oil Search closed 2.9% higher after the Papua New Guinea government signalled its backing for a liquefied natural gas deal in which the company is a partner. In New Zealand, the benchmark S&P/NZX 50 index finished 0.9% lower at 10,766.03. Dairy products makers A2 Milk Co and Synlait Milk led losses, giving up 3.3% and 3.7%, respectively.