Australian stocks weaken over Spanish fears: Afternoon market insights

The Australian sharemarket plunged lower today despite strong leads from Europe and the United States.

At 3.30pm AEST the ASX200 had fallen 0.63% to 4088.5, while the broader All Ordinaries lost 0.59% to 4143.6.

CMC Markets senior trader Tim Waterer said the ASX200 has hit a mid-week hurdle over escalating Spanish yields and doubt over Chinese stimulus measures.

“With traders uptight about the state of the Spanish financial system, commodity prices gave way to a run higher in the defensive US Dollar, with our Materials and Energy stocks feeling the effects of this today,” he said.

The dollar fell slightly to $USD 0.979, which Waterer said was due to the negative retail sales result. Retail sales fell 0.2% in seasonally adjusted terms during April, despite economists’ predictions of a 0.2% rise.

“While the focus in recent weeks has been on the trials and tribulations in Europe, the retail sales number was a reminder that things are not all rosy in our own backyard and that the RBA have plenty to contemplate over coming months.”

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