ASX plummets below crucial support level, largest fall recorded in 2017

The ASX 200 index slumped below the 5600 support level. The slip, which occurred for the first time this year, was largely attributed to the losses in Macquarie. It also comes ahead of RBA's first rates decision of 2017.

As of 12:20 p.m. on Tuesday, the benchmark S&P/ASX200 fell by 23.7 points (0.42 percent) to 5591.9 points. On the other hand, the broader All Ordinaries index suffered a decline of 23.1 points (0.41 percent) to at 5642.3 points.

“The fact the index closed at the day’s low yesterday at 5615 is quite telling, so it will be interesting to see how the market fares from around 10.30am (AEDT) today,” IG chief market strategist Chris Weston said. “SPI futures are down 16 points with price trading down to 5535 at 10.10am and a new low for the year ... A close below 5500 (in futures markets) and we are looking at a move into 5400.”

The financial component of Australia's S&P/ASX 200 went down by 0.9 percent. Its energy component suffered a downfall of 0.52 percent. Nevertheless, the index's gold sub-index witnessed an increase of 3.3 percent.

“There has been somewhat of a risk-off tone to markets, although there doesn’t seem to be a smoking gun and there really is no panic,” Weston said.

The Reserve Bank of Australia's interest rate decision is predicted to remain at 1.50 percent. "While the low September quarter inflation reading leaves the door wide open for another rate cut, a move on Tuesday is unlikely as the inflation outcome was in line with the RBA's own forecast," Shane Oliver, head of investment strategy and chief economist at AMP capital, said. "It's likely to want to monitor the recent uptick in lending to property investors and see how the economy performs after the September quarter slump."

As reported by AAP (via The Australian) As of midday, significant declines had been witnessed by banks and insurers. These were causing the share market to slump lower.

Among the most affected was Macquarie Group. Following a third quarter trading update, Macquarie said its capital markets-facing businesses faced a slower growth than a year ago. Although its shares fell by 2.9 percent, the company was optimistic about repeating last year’s annual profit achievement of $2.1 billion.

With regard to the banks, ANZ recorded the worst downfall. It slumped by 1.2 percent. Meanwhile, Reserve Bank of New Zealand Governor Graeme Wheeler, whose current term ends on Sep. 26, has said he would not be running for a second term.