SYDNEY: The Australian sharemarket has fallen sharply at the open, giving up more than 1.1 per cent, after Wall Street slumped on news of weaker-than-expected first-quarter growth and financial stocks continued their freefall.
At the 10.15am (AEST) official market open, the benchmark S&P/ASX200 index was 69.2 points, or 1.19 per cent, lower at 5,769.4 points, while the broader All Ordinaries index was down 65.4 points, or 1.12 per cent, at 5,752.8 points.
IG market strategist Evan Lucas said the selling of the banks yesterday was a glaring reminder that earnings are looking strained even in that sector.
“Preview after preview from the investment banks are seeing earnings downgrades for the retail banks that are reporting next week,” he said.
Mr Lucas said the bulls had clearly experienced exhaustion at 5,990, expectations for the banks are to the downside and the push needed to break the resistance at 6,000 seems lost for now.
“I can’t see the ASX legging higher in the next three weeks unless the RBA cuts rates, the federal budget is more conducive of growth and the banks report earnings growth well above expectations – a tough ask to get all three,” he said.
Financials were the worst performing sector, losing 1.66 per cent.
