Australia shares drop 1% as fresh coronavirus curbs dent sentiment

Credit: REUTERS/STEVEN SAPHORE

Australian shares fell 1% on Wednesday as fresh coronavirus-related restrictions fanned fears of further economic damage, though losses were limited by a rally in gold stocks after the precious metal surged to a record high.

By Arpit Nayak

Aug 5 (Reuters) - Australian shares fell 1% on Wednesday as fresh coronavirus-related restrictions fanned fears of further economic damage, though losses were limited by a rally in gold stocks after the precious metal surged to a record high.

The S&P/ASX 200 index .AXJO was down 1% at 5,979.3, as of 0102 GMT.

Australia's Queensland state said it would seal off its border with New South Wales and capital Canberra to hold back a second wave of coronavirus cases.

Australia's second-most populous state Victoria has also enforced stringent movement controls and ordered the closure of large parts of the local economy in a bid to contain an alarming resurgence in coronavirus cases.

Heavyweight financials .AXFJ were the biggest laggards in the benchmark, easing up to 2.5% with top lenders Commonwealth Bank of Australia CBA.AX and Westpac Banking Corp WBC.AX dropping 2.6% and 3.1%, respectively.

Telecom firm Telstra Corp TLS.AX dropped 1.2% after announcing the sale of its Melbourne data centre for about $300 million.

On the flip side, gold stocks .AXGD jumped 3.7% after bullion prices touched fresh highs as hopes of further U.S. stimulus and a weaker U.S. dollar bolstered the safe-haven asset's appeal. GOL/

Newcrest Mining NCM.AX and Australia-listed shares of AngloGold Ashanti AGG.AX climbed 3% and 4.7%, respectively.

The gains in gold stocks helped miners .AXMM trade in the black as well.

New Zealand's benchmark S&P/NZX 50 index .NZ50 eased 0.4% to 11,728.31.

The country's unemployment rate unexpectedly declined in the second quarter, but the data did not fully reflect the weakness in the labour market as fewer people actively sought work.

(Reporting by Arpit Nayak in Bengaluru, Editing by Sherry Jacob-Phillips)

((Arpit.Nayak@thomsonreuters.com; +91 80 6182 3472;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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