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As it happened: ASX caps dour September with $41b decline

Summary

  • The ASX200 tumbled by 2.3% on Wednesday - shedding $41 billion - as it recorded a quarterly decline and its first monthly loss since March
  • The ASX was badly underperforming other Asian markets on Wednesday. US futures took a dive after a belligerent US presidential debate and were down more than 1% at 5pm AEST
  • Corporate Travel Management was easily the best performer on the index, rising by as much as 19% to an eight-month high on the completion of its $262m institutional raising
  • The Banking Code and Compliance Committee has taken the unprecedented step of naming and shaming Bendigo and Adelaide Bank for "serious and systemic" breaches of its code of conduct

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Markets wrap: September blues wipe 4% from ASX200

By Alex Druce

The ASX200 tumbled 2.3 per cent on Wednesday - shedding $41 billion - as it recorded a quarterly decline and its first monthly loss since March.

A dour September wiped 4 per cent off the benchmark index and put an end to a five-month rally as investors face renewed fears over global growth, wrangling over fiscal stimulus, and concerns equity markets have perhaps risen too far, too fast.

The ASX200 fell 2.3 per cent on Wednesday. Credit:Jim Rice

The market fell 1.4 per cent for the quarter, having jumped by 16.2 per cent between April and June and remaining steady through a better-than-expected August earnings season.

Local trading boards were awash with red on Wednesday as investors moved to rebalance, knocking 136.2 points off the local bourse for a close of 5815.9.

All sectors ended more than 1.5 per cent lower, with energy stocks copping the hardest hit on an oil price dive.

A belligerent US presidential debate on Wednesday morning (Australian time) did little to soothe investor nerves, with losses accelerating on nosediving US futures markets.

While there was little policy or economic sense to come out of the messy scrimmage between Donald Trump and Joe Biden, markets were seemingly spooked by the former’s intent to challenge any “tainted” election result.

About 80 points was wiped off the ASX200 in about two hours.

“Things turned negative when (Trump) mentioned the end result of the election... and alluded to how he plans to take it,” Milford Asset Management portfolio manager Mike Higgins said.

“That was really the only bit of ‘new’ news… markets do not take that uncertainty very well.”

Wall Street’s lead was already weak after rising coronavirus case numbers in parts of Europe and the US fuelled concerns over global growth, knocking oil prices sharply lower.

Mr Higgins said end-of-month rebalancing also likely played a role in Wednesday’s losses.

“When you’ve had a big move in the market indices like we’ve seen this month, the S&P and NASDAQ are about 5 and 6 per cent off... it does cause people to reassess,” he said

Just 11 of the ASX 200 companies gained ground on Wednesday.

Fortescue Metals, Amcor, and Spark NZ were the only firms at the top end of the market to offer any resistance.

Corporate Travel Management was easily the best performer, rising 9.7 per cent after completing a $262 million capital raising to buy another US firm.

Improved coronavirus numbers and positive Chinese Services data were lost in the noise of the presidential debate.

Mainland China heads on holiday for a week from tomorrow, as will Hong Kong and Taiwan. South Korean markets break on Friday.

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