“Worst day in two or three years”: ASX reacts to Greek economic crisis

Investors described yesterday as the “worst day in two or three years” with more than $35 billion wiped off the Australian stock market - a reaction to the breakdown in talks between Greece, the eurozone and IMF creditors.

IG Market Strategist Evan Lucas told news.com.au that the market was on track for its worst day in several years as both the S&P/ASX 200 and All Ordinaries were down almost 2% within the first hour of trade.

“Unfortunately this could probably be our worst day in two or three years, you’d probably be going back to 2011 or 2012,” he said.

“It’s a very tough time and unfortunately nothing will be spared, except perhaps gold.”

This was certainly the case as the dip spread across the market with banks, miners, retailers, healthcare providers and telcos all experiencing sharp downturns, while gold stocks were moderately up.

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ANZ fared the best out of the big banks with a fall of 65c to $32.4, followed by NAB (down 66c), Westpac (down 74c) and lastly the Commonwealth Bank which had the largest drop of $1.81 to $84.4 reported Nine News. The Australian dollar also experienced a decline around 3 quarters of a US cent since Friday and is currently trading at around 76.3 US cents.

Although the Australian market has little exposure to Greece, Lucas said that the ASX is one of the first stock markets to react to a possible Greek default and exit from the eurozone with the sell off likely to be replicated in other markets.

Meanwhile in Greece, ATM caps of €60 (A$87) and the closure of the country’s bank branches remain, until after Sunday’s referendum where the citizens will decide whether they accept the austerity plan demanded by the IMF and the rest of the Eurozone that would result in pension cuts and steep tax increases. The chances of an exit from the Euro are higher, if Greece’s citizens reject the plan.