May 12, 2020 / 6:56 AM / 23 days ago

Australia shares fall on fear over new coronavirus cases, China's beef import ban

(Updates to close)

By Soumyajit Saha

May 12 (Reuters) - Australian shares ended lower on Tuesday due to concerns over a second wave of coronavirus cases in several nations and a partial ban by China on the country’s beef imports.

The benchmark S&P/ASX 200 index fell 1.07% to 5,403.

France and Germany, which had started easing coronavirus-led restrictions due to reducing cases, saw a spike in new infections, while Russia and India registered record numbers of daily new cases.

Wuhan, the epicentre of the outbreak in China, reported five new cases on Monday.

The resurgence of the virus comes as Australia readies to partially open up public places in New South Wales, its most populous state, while Victoria is set to resume face-to-face teaching weeks earlier than expected.

“Investors remain watchful about the potential of a second wave once economies reopen. Defensive sectors like healthcare and consumer staples are the only ones to improve today,” said James Tao, market analyst at Commonwealth Securities.

A ban on beef imports from four large Australian meat processors by largest trading partner China also weighed on the market’s sentiment.

The suspension came as ties between the two countries soured over Canberra’s support for an inquiry into the coronavirus outbreak’s origin, although the Australian minister for trade denied the ban was retribution.

Losses among miners underpinned losses on the broader index, further exacerbated by a fall in iron ore prices as dismal inflation data suggested underlying demand continued to remain weak in China.

Benchmark heavyweights BHP Group and Rio Tinto fell 2.6% and 1.7%, respectively.

Meanwhile, National Australia Bank’s index of business conditions slid deeper into negative territory in April as sales, profit and employment suffered from coronavirus-induced lockdown.

A subindex for financial stocks also fell to snap two sessions of gains, with the “Big Four” banks down between 0.7% and 2.9%.

Energy stocks nearly 2.5% as oil prices slid overnight, though prices recuperated as Saudi Arabia promised further production cuts.

The subindex for healthcare stocks bucked broader trend to rise, as the export reliant stocks benefited from a stronger greenback.

Medical devices maker Resmed Inc jumped 5.2%, and heavyweight CSL Ltd rose 1.8%.

Brent crude futures rose 0.44% to $29.76 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 1.24% to $24.44 per barrel.

Chinese iron ore futures on the Dalian Commodity Exchange fell 0.4%.

The number of issues on the ASX that advanced were 596 while 941 declined.

New Zealand’s benchmark index rose 0.5% to 10,818.67 points, helped by gains among utility and healthcare stocks.

Reporting by Soumyajit Saha in Bengaluru; Editing by Rashmi Aich

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