PM asks business to support economy in act of “patriotism”
Prime Minister Scott Morrison has asked business to shoulder some of the burden of coronavirus’ impact on the economy in an act of “patriotism”, describing the situation as “one of those national interest moments”.
At the AFR Business Summit on Tuesday morning Morrison warned that whatever businesses thought 2020 would be, “think again.”
“We now have one goal together this year – to protect the health, the wellbeing, and the livelihoods of Australians through this global crisis, and to ensure that when the recovery comes – and it will – we are well-positioned to bounce back strongly on the other side,” Morrison said.
Businesses are being urged to hold onto and support staff, and pay suppliers on time and in full, in order to keep the Australian economy ticking along during the international virus outbreak.
The Prime Minister also laid out the principles of the government’s yet-unannounced stimulus package, which is expected to put around $10 billion back into the Australian economy.
According to AAP, the government’s economic response must be proportionate, timely and scalable, targeted to specific issues, aligned with other areas of policy including the RBA’s actions, use existing delivery mechanisms such as Centrelink payments, temporary, and lift productivity.
Globally, the virus now has more than 111,600 cases confirmed and has caused more than 3,800 deaths. Locally, Australia has confirmed more than 80 confirmed cases of the virus and 3 deaths.
“Black Monday” wipes $155bn
While the government puts the finishing touches on this response, the Australian stock market has seen the single biggest loss in over a decade with about $155 billion wiped to what is now being termed “Black Monday”.
Publicly-listed retailers are bracing for further losses as the spread of coronavirus continues to drag on the stock market, and though Monday was tough for many the ASX was largely down all of last week.
Some retailers have seen stock prices drop by more than 20 per cent in the last week, as markets and consumers react to the virus having hit Australian shores.
Perhaps unsurprisingly, the travel and finance sectors were the worst hit, with Flight Centre having lost 20.4 per cent in value in the last week from $31.1 per share down to $24.75, as international governments put travel bans in place.
Buy now pay later operators Afterpay and Zip were also down, with Afterpay shares falling from $32.64 per share to $27.63 (34 per cent down), and Zip shares falling from $2.84 per share to $1.82 (35.9 per cent down).
Even some of the industries strongest operators weren’t immune to the effects of the virus, with JB Hi-Fi seeing shares fall 11.44 per cent from $36 per share to $31.88. Accent Group shares fell 25.62 per cent from $1.6 per share to $1.19 per share.
Australia’s supermarket sector was less impacted – likely due to the untick in spending due to consumers panic spending on household essentials. Woolworths saw a modest 3 per cent decline from $38.63 per share to $37.47, while Coles saw a 4 per cent increase from $14.67 to $15.25.
Metcash also saw a 1.2 per cent increase, from $2.47 per share to $2.5.
Online operator Kogan saw shares drop 13.12 per cent, while shares in furniture marketplace Temple & Webster fell 20 per cent.