* Australian energy stocks slump to near 16-year low
* Technology stocks biggest drag, Afterpay plunges
* New Zealand shares climb 2.3%, Pushpay top gainer
By Pranav A K
March 18 (Reuters) - Australian shares fell almost 5.5% on Wednesday, wiping out most of the gains made in the last session’s rebound, as fears of a coronavirus-induced recession outweighed stimulus measures aimed at cushioning the hit from the worsening epidemic.
The S&P/ASX 200 index dropped 5.4%, or 285.00 points, to 5,008.40 by 0212 GMT. It rose 5.8% on Tuesday in its biggest jump since October 2008, helped by a bigger-than-expected cash injection by the central bank and promises of more stimulus measures.
The benchmark index has now lost nearly a quarter of its value this year, and may have found a floor at around 5,000 levels.
“You have got to be a brave soul to commit to the market in this extremely volatile environment,” said Steven Daghlian, a market analyst at CommSec.
Investors now wait for the Reserve Bank of Australia’s announcement on Thursday as the central bank is likely to follow in the footsteps of the U.S. Federal Reserve in cutting interest rates.
“Unfortunately, we expect the economic impact of COVID-19 to tip the Australian economy into recession,” ANZ Research analysts said in a note.
“Policy stimulus will help, but it won’t be able to offset the demand loss that will come from social distancing and widespread closures. We expect further policy announcements in coming days.”
Prime Minister Scott Morrison on Wednesday told Australians to abandon all overseas travel and banned all non-essential indoor gatherings of more than 100 people.
Sell-off was broad-based, with energy stocks plumbing a near 16-year low as oil prices dropped below $30 a barrel.
Oil Search tumbled 15.5% after the company slashed its expected capital and investment spending for 2020, while gas supplier Santos Ltd lost more than 9%.
Top lenders Commonwealth Bank of Australia, Westpac Banking Corp, National Australia Bank and Australia and New Zealand Banking Group fell between 5.1% and 7.6%.
Technology stocks crashed 8.8% to their lowest since October 2017 and were the worst hit on the benchmark. Afterpay Ltd dived 25.8%, while EML Payments lost 18.9%.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index climbed 2.3%, or 220.09 points, to 9,654.51, a day after the government announced one of the world’s largest per capita stimulus packages in an attempt to shield the economy from the virus impact.
Pushpay Holdings surged by 36.7%, making it the top gainer on the index after the payments platform provider raised its core earnings forecast.
Meanwhile, government data showed the country’s current account deficit narrowed to 3% of GDP in the December quarter. (Reporting by A K Pranav in Bengaluru; Editing by Subhranshu Sahu)