Australia: Shares slip as dour GDP outlook, Sino-US rift weigh
[SYDNEY] Australian shares closed lower on Friday after the central bank downgraded its outlook for the national economy and as a US ban on transactions with China's ByteDance and Tencent heightened tensions between the world's leading economies.
The executive orders, which go into effect in 45 days, come after the Trump administration said this week it was stepping up efforts to purge "untrusted" Chinese apps from US digital networks and called TikTok and WeChat "significant threats."
"The ban has brought the trade tensions back to the centre of all attention ... inflaming nerves ahead of what's probably going to be a crucial week in US-China relations," said Kyle Rodda, market analyst with IG Australia.
The two countries are set to review the implementation of their Phase 1 trade deal on Aug 15.
The S&P/ASX 200 index was down 0.6 per cent at 6,004.8 by the end of trade. The index gained 1.3 per cent for the week, but still hovered around the 6,000 point level.
Risk sentiment was further dented after the Reserve Bank of Australia said it expects annual gross domestic product to contract by 6 per cent this year and unemployment to remain high for several years.
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"The market has not been wiling to take too much risk ahead of an important earnings season and all that really is known is that there will be a reasonably big contraction in earnings growth ... there is also some trepidation about the affect of the Victoria lockdown," Ms Rodda said.
Among sectors, miners fell more than 1.5 per cent, with global miners BHP Group and Rio Tinto receding 1.3 per cent and 2.9 per cent, respectively.
New Zealand's benchmark S&P/NZX 50 index fell 1 per cent to 11,646.6 points, hurt by losses among financials and healthcare stocks.
REUTERS
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