Shares tumble as jobless rate worsens

Australian stocks slid on Thursday amid signs rising unemployment could weaken the Australian economy.

The benchmark S&P/ASX 200 closed the day down 42 points, or 0.7 per cent, to 6010.9, while the broader All Ordinaries index slid 37 points, or 0.6 per cent, to 6123.

The Australian dollar at the end of the day was down 0.2 per cent to 69.93 US cents, after reaching highs of 70 US cents the previous day.

Dampened performance by local share markets came despite strong gains on Wall St, where the Dow Jones and S&P 500 both made gains of 0.9 per cent, while the Nasdaq ended its session up 0.6 per cent.

Labour market figures released by the Australian Bureau of Statistics on Thursday showed the country’s unemployment rate had risen to 7.4 per cent for the month of June.

AMP Capital senior economist Diana Mousina said she expected unemployment to reach rates of up to 9 per cent by the end of year.

“Subdued employment growth and a rising labour force participation rate means that the unemployment rate will keep rising,” she said.

“This means that there is a need for government fiscal stimulus to keep going for now.”

Healthcare and property sectors had the largest sector falls, while communications and industrials were the only sectors to end the day positive.

Cooper Energy experienced the largest gains, with its stock closing the session up 6.3 per cent to 42 cents per share.

Home appliance company Breville had the largest fall of the day, declining 6 per cent to $23.99 per share.

Shares in major banks slipped with Commonwealth Bank ending the session down 0.1 per cent to $72.64 per share, while ANZ dropped 0.9 per cent to $18.49.

Westpac shares fell 1 per cent to $17.81 each, while NAB fell 0.6 per cent to $18.07 per share.

Rio Tinto fell 1.4 per cent to 103.50 per share, while its major rival BHP sustained a share price drop of 0.6 per cent to $37.64 each.

Commercial property group Dexus ended the day down 1.8 per cent to $9.20 per share, Stockland fell 1.2 per cent to $3.27 and Mirvac fell 1.8 per cent to $2.13.

Telstra’s stock slid 0.3 per cent to $3.46 per share and Coles Group fell 0.5 per cent to $18.11.

Woolworths dropped 0.3 per cent to $38.80 per share, while Wesfarmers fell 0.6 per cent to $46.60.

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