ASX 200: Heavy losses spread to retail and property sectors amid continuing coronavirus meltdowns

23 March 2020

Share price plunges spread from the travel and resources sectors last week, as the global impact of the coronavirus pandemic on international trade and economies got worse.

ASX 200 at 12:55 to 23 March, 2020.
ASX 200 at 12:55 to 23 March, 2020. Source: Google

Volatility in the market appears set to continue – this morning, the ASX plunged 8.5% within 10 minutes of opening, as dozens of companies issued updates.

Before opening, Flight Centre requested its shares be suspended from the market until next year “to allow the Company to continue to assess the impact of coronavirus on its business”. Likewise, Webjet’s share price has been suspended since Thursday, pending an announcement about a potential capital raising.

Casino operator Star, which has operations in Sydney and the Gold Coast and is undertaking a multibillion-dollar development in Brisbane, also entered a trading halt this morning, while JB Hi-Fi and Tabcorp have withdrawn their earnings guidance.

Last week, the Australian Government and the Reserve Bank doubled down on protective measures to back the population and the economy, but domestic and international markets continued to fall as COVID-19 infection numbers grew.

Losses on the ASX last week were the biggest since the days of the global financial crisis in 2008.

Investors fled household-name stocks including Southern Cross Media, Afterpay, Flight Centre, Nine, Myer and Qantas, which suffered some of the heaviest falls in another major week of losses for the majority of stocks.

ASX: It’s all about coronavirus. And a little about oil

Markets are expected to provide another rollercoaster ride again this week.

US markets fell between 4% and 5% on Friday, a lead usually followed by Australia. A dominant factor playing into the challenges will be the extraordinary Australian government actions over the weekend – closing entertainment areas, restaurants and cafés to reduce social contact.

The government’s $189 billion stimulus aimed at keeping workers in their jobs could potentially help prop up the market, but most stocks are expected to continue sliding this week, amid the ongoing shutdown of the economy and extreme uncertainty.

Last week the All Ordinaries fell 13.16%, despite a rally on Friday. Without it, the red would have been worse.

Actions are being taken: the Reserve Bank announced another cash rate cut on Thursday, and then a bond-buying spree to underwrite the financial system. The central bank has vowed not to increase the official rate from its new record low of 0.25% until Australia makes progress towards “full employment”.

Social distancing is now a common term after the Australian Government announced strict measures – twice during the week – to restrict gatherings. It also effectively closed the nation’s borders to all visitors.

But despite these announcements, the value of the top 200 companies on the ASX fell 13.04% over the week to close at 4,817 points. The stock market has lost about a third of its value since its peak in February, largely due to the international ramifications of the coronavirus and the dramatic impacts of the measures governments are taking to contain its spread.

Official figures reflecting those impacts should be revealed this week, with Australian data on consumer confidence, manufacturing and construction set for release.

S&P and All Ords Movements (13/03/2020 to 20/03/2020)
  Closing Points % Change
S&P/ASX 200 (XJO) 4,817 -13.04%
All Ordinaries (XAO) 4,854 -13.16%
Prepared by Canstar. Points taken as of Monday open to Friday close.

Energy stocks hit again, while non-grocery retailers take a dive

The pandemic continues to have a significant impact on travel-related and energy stocks.

After the government directive last Wednesday for Australians to not travel overseas, Qantas (QAN) announced 20,000 of its 30,000 employees would be stood down temporarily. Its shares tumbled 15.4% in a day but regained some losses to end the week at $2.36. Flight Centre (FLT) was also down.

On the same day, oil fell a massive 24% amid the ongoing stoush over supply between Saudi Arabia and Russia and the lower demand for fuel, including road and air fuel. Australian energy stocks were down an average of 24.3% last week.

Retail was also affected, with the consumer discretionary section tumbling 21.41%.

Myer’s (MYR) share price plummeted 44% in a day with fewer shoppers around. Its valuation has fallen more than 80% this year.

Home retailer Adairs (ADH) fell 27.5% over the week. 

The banks continued to be punished, with all the big four down. The Commonwealth Bank (CBA) declined another 9.7% to $59.91, and Westpac (WBC) and National Australia Bank (NAB) experienced double-digit declines ($15.77, down 13% and $15.66, down 14.9%).

Investment bank Macquarie (MCG) fell 27.5% to $85.06.

Vaccine maker and market darling CSL also fell 13.7% but remains up for the year.

The few bright spots on the Australian Securities Exchange last week involved groceries, given Australians’ peak buying.

The consumer staples sector grew 1.12%, an achievement against the wider market falls.

Utilities and materials were relatively steady, compared to the rest of the market volatility.

Of the big companies, investors moved into the relative safety of iron ore miner Fortescue Metals (FMG), which ended up 4.2% in the week, health-machinery maker Fisher & Paykel (up 7.3%), Coles (up 4.5%) and BHP (up 1.1%). 

Sector Movements (13/03/2020 to 20/03/2020)
  Closing Points % Change
Consumer Discretionary (XDJ) 1,743 -21.41%
Consumer Staples (XSJ) 12,173 1.12%
Energy (XEJ) 5,431 -24.67%
Financials (XFJ) 4,075 -13.67%
Health Care (XHJ) 37,231 -14.70%
Industrials (XNJ) 4,516 -15.60%
Information Technology (XIJ) 914 -16.34%
Materials (XMJ) 10,113 -3.68%
Telecommunication Service (XTJ) 1,031 -11.03%
Utilities (XUJ) 7,011 -0.15%
Prepared by Canstar. Points taken as of Monday open to Friday close.


ASX 200 – Top 5 Market Capitalisation Gains (13/03/2020 to 20/03/2020)
Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price
1 Fortescue Metals Group $1,293,165,265 $10.35 4.2%
2 Fisher & Paykel H Foreign Exempt NZX $1,005,641,519 $25.80 7.3%
3 Coles Group $973,768,678 $16.78 4.5%
4 BHP Group Ltd $854,296,904 $27.01 1.1%
5 Amcor Plc Cdi 1:1 Foreign Exempt NYSE $809,738,684 $11.90 7.2%
Prepared by Canstar. Prices taken as of week to week close.


ASX 200 – Top 5 Market Capitalisation Losses (13/03/2020 to 20/03/2020)
Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price
1 CSL Ltd -$19,498,682,044 $270.88 -13.7%
2 Commonwealth Bank -$11,418,044,821 $59.91 -9.7%
3 Macquarie Group Ltd -$11,134,663,462 $85.06 -27.0%
4 Westpac Banking Corp -$8,487,459,444 $15.77 -13.0%
5 National Aust. Bank -$8,109,772,231 $15.66 -14.9%
Prepared by Canstar. Prices taken as of week to week close.

Some stocks are still going up, amid high volatility

In line with Australians’ panic-buying with volumes currently exceeding the peak Christmas lead-up, wholesaler Metcash (MTS) jumped 31.7% last week.

Investors piled into health insurer NIB Holdings (NHF) to push its price up 24.9% to $4.96, perhaps due to a lower demand for non-essential healthcare which could reduce claim costs.

In a crisis, gold is often considered a “safer haven” for investors. Gold Road (GOR) climbed 11.7%.

Online gambling provider Jumbo Interactive also gained 9.6%.

Investors bought into agricultural chemicals company Nufarm, pushing its valuation up almost 20% to $5.04.  

ASX 200 – Top 5 Share Price Gains (13/03/2020 to 20/03/2020)
Rank Code Company Closing Share Price % Change
1 MTS Metcash Ltd $3.20 31.7%
2 NHF Nib Holdings Ltd $4.96 24.9%
3 NUF Nufarm Ltd $5.04 19.7%
4 GOR Gold Road Resources $1.05 11.7%
5 JIN Jumbo Interactive $9.15 9.6%
Prepared by Canstar. Prices taken as of week to week close.

But huge losses in market value for Southern Cross Media, Flight Centre and Afterpay

Media companies have been hit hard in this latest crisis.

Last week, investors bowed out of Southern Cross Media (SXL), more than halving its share price to $0.25. Together with Seven West Media (SWM), they have lost about 80% of their total value this year to date.

Lender Credit Corp (CCP) was also hit 47.7%, and buy-now pay-later provider Afterpay (APT) 46.5% amid concerns bad debts will deepen.

Diversified property group Stockland also fell 46.2%. 

ASX 200 – Top 5 Share Price Losses (13/03/2020 to 20/03/2020)
Rank Code Company Closing Share Price % Change
1 SXL Southern Cross Media $0.25 -52.9%
2 FLT Flight Centre Travel $9.91 -48.3%
3 CCP Credit Corp Group $9.83 -47.7%
4 APT Afterpay Ltd $12.44 -46.5%
5 SGP Stockland Corporation Ltd $2.14 -46.2%
Prepared by Canstar. Prices taken as of week to week close.

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