At noon AEST on Wednesday, the benchmark S&P/ASX200 index was down 146.1 points, or 1.8 per cent, to a nearly three-week low of 7,957.1, while the broader All Ordinaries had dropped 155.7 points, or 1.87 per cent, to 8,167.0.
The losses came after an even steeper drop on Wall Street, where the S&P500 fell 2.1 per cent and the Nasdaq retreated 3.3 per cent following the release of the Institute for Supply Manufacturing's report showing a decline in US manufacturing activity for a fifth straight month.
"Make of the ISM survey what you will – the ISM survey does have its critics – but the market is the market and you can't really criticise the collective weight of capital that has reacted to the outcome," Pepperstone head of research Chris Weston said.
It was the same survey a month ago that led to a 2.1 per cent drop in the ASX200 - the first day of a two-day plunge - with the losses also coming after a sharp rally for the bourse.
As traders ran for cover, the release of Australian second-quarter gross domestic product figures shortly before midday didn't budge the market much.
The Australian Bureau of Statistics reported Australia's GDP increased by 0.2 per cent in the June quarter, for an annual rate of one per cent. Australia's GDP per capita contracted 0.4 per cent for the quarter.
"The Australian economy grew for the eleventh consecutive quarter, although growth slowed over the 2023-24 financial year," Katherine Keenan, ABS head of national accounts.— Australian Bureau of Statistics (@ABSStats) Visit https://t.co/07qznbHMI4 pic.twitter.com/MTKDLOvSIcSeptember 4, 2024
"Today's national accounts data show the economy is still on life support, with growth over the past year slipping to its slowest pace since the early 1990s, outside of the pandemic," Deloitte Access Economics partner Stephen Smith said.
Every sector of the ASX was lower, with nine of the 11 sectors down at least one per cent.
Energy, materials, tech and financials were down more than two per cent, with energy the worst performer with a 2.9 per cent drop.
Uranium developer Deep Yellow was the biggest laggard in the ASX200, dropping 8.4 per cent to a two-week low of 98.5c, followed by Fortescue which had dropped 8.4 per cent to nearly two-year low of $16.22 as the iron ore giant traded ex-dividend.
BHP was down 1.9 per cent, Rio Tinto had retreated 2.2 per cent and South32 had fallen 3.2 per cent.
All of the big banks were down, with ANZ dropping 1.8 per cent, Westpac subtracting 2.3 per cent, NAB retreating 3.0 per cent and CBA trading 2.5 per cent lower.
Orora was a rare gainer, climbing 6.8 per cent to a five-month high of $2.67 after the global packaging manufacturer agreed to sell its North American business to Veritiv Corp for $1.8 billion.
The sale will leave Orora as a company focused on beverage packaging, with the proceeds used to pay down debt and expand its aluminum can capacity at Rocklea, Queensland.
The Australian dollar had fallen two a two-week low, buying 67.01 US cents, from 67.43 US cents at Tuesday's ASX close.
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