Updated ,published for the first time
Australia’s stock market recorded its biggest one-day decline since US President Donald Trump’s “Liberation Day” stock market carnage last year, as bitcoin plunged amid a global cryptocurrency rout.
The S&P/ASX200 fell on Friday, closing 2 percent lower amid sharp falls in several major sectors: technology stocks, banks and mining companies.
The drop means more than $60 billion worth of shares were wiped off the ASX on Friday. It follows a sharp sell-off on Wall Street overnight and comes as the collapse of cryptocurrencies has also accelerated, with bitcoin this week hitting its lowest level since Trump won the 2024 election.
Despite Trump’s support for the cryptocurrency market and his pro-cryptocurrency policies, bitcoin has now fallen by almost half from its record high of over $124,000 in October last year to $64,907 as of Friday afternoon, while other speculative crypto assets have also fallen sharply.
Falling crypto prices are hitting investors who have invested in the digital asset hard, but Steve Orenstein, who runs a software company with 12.3 bitcoins ($1.1 million) on his balance sheet, brushed off the recent price drops, saying he was “very unfazed.”
Orenstein is the chief executive of Locate Technologies, a logistics software company that chose to hold Bitcoin assets and last year moved its listing from the ASX to the New Zealand Stock Exchange, primarily because the NZX would allow the company to buy more Bitcoin.
He pointed out that bitcoin has long been volatile, but said he believes currencies issued by governments around the world have been devalued by governments taking on heavy debt and printing “large amounts of money.”
Orenstein said that when he spoke at a Bitcoin event in Brisbane this week, there was no fear about the price of the digital asset among the 60 or so attendees.
“It’s not a trading asset. It’s a long-term holding for a very strategic reason,” he said of the company’s investment in Bitcoin.
While bitcoin has been falling for months, this week’s dramatic fall came as investors also dumped software stocks due to fears about the disruptive impact of artificial intelligence.
“It is clear that the crypto market is now in total capitulation mode,” said Nic Puckrin, investment analyst and co-founder of Coin Bureau. “If previous cycles are to be believed, this is no longer a short-term correction, but rather a transition from distribution to reset – and these typically take months, not weeks. »
On the ASX, companies with exposure to cryptocurrencies have also seen their share prices hit, with fintech giant Block falling 7% on Friday.
While no sector was spared on the ASX, technology stocks fell particularly sharply, with Wisetech falling 4.6 per cent, NextDC losing 3.9 per cent and TechnologyOne down 5 per cent.
Mining stocks closed in the red, with BHP losing 3.1 per cent and Fortescue losing 1.2 per cent. Rio Tinto was flat after it was revealed the company was walking away from merger talks with Glencore to create what would have been the world’s largest mining company.
Among gold stocks, Northern Star lost 1.7 percent and Evolution Mining fell 1.4 percent. Silver player South32 lost 4.5 percent as precious metals markets continue to fluctuate.
Energy stocks fell sharply as oil prices fell after Iran confirmed it would hold negotiations with the United States, easing the immediate risk of military conflict and supply disruptions from the OPEC producer. Woodside Energy lost 1.6 percent and Santos fell 1.4 percent.
Financial stocks were also down, with the big four banks falling. Commonwealth Bank lost 0.2 per cent, Westpac fell 1.2 per cent, National Australia Bank fell 1.6 per cent and ANZ Bank fell 1.5 per cent. In total, the ASX 200 fell 180.4 points to 8,708.80, the biggest drop since last April, when Trump unveiled tariff plans that spooked the market.
The Australian dollar was worth US69.61¢ at 5:17 p.m. AEDT.
On Wall Street, the S&P 500 index fell 1.2 percent, its sixth loss in seven days since hitting an all-time high. The Dow Jones fell 592 points, or 1.2 percent, and the Nasdaq composite fell 1.6 percent.
Alphabet lagged the market and slipped 0.5 percent, after narrowing an earlier loss of 8 percent, even as the parent of Google, YouTube and other companies reported profit for the latest quarter that was stronger than analysts expected. Investors instead focused on how much Alphabet spent on artificial intelligence technology and questioned whether it was worth it.
Alphabet said its spending on equipment and other investments could double this year to around $US180 billion ($260 billion). That beat analysts’ expectations of less than $119 billion, according to FactSet.
On the winning side of Wall Street were companies that stand to benefit from Alphabet’s big spending and others chasing the AI frenzy. Chip company Broadcom added 0.8 percent.
With the journalist, AP, Reuters
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Clancy Yeates is deputy economics editor. He covered banking and financial services and was previously national business correspondent in the Canberra office.Log in via Or e-mail.
