ASX 200 Weekly Wrap: ASX retreats as confidence wanes

The S&P/ASX 200 Index (ASX: XJO) retreated 0.65% last week as global fears over a second wave of the coronavirus pandemic set in.

ASX 200 shares had been enthusiastically rallying in recent months, partly a result of jubilation over the relaxing of COVID-19 restrictions and hopes of a rapid 'return to normal' for the economy. But a new surge in cases last week in Victoria, as well as a spike in infection rates across the United States and the United Kingdom, have resulted in old fears boiling to the surface. Last week marked the ASX 200's second week of losses out of the past 9 weeks of trading.

ASX travel shares lashed the market

It shaped up to be a rather dramatic five days on the ASX boards last week. We finally learned the future of Virgin Australia, with US-based private equity firm Bain Capital emerging triumphant from the administration process as the airline's new master. Aussie investors might not be too familiar with Bain, but it was notably founded by former US presidential candidate Mitt Romney back in 1984.

In other news, Qantas Airways Limited (ASX: QAN) finally bowed to the inevitable and launched a capital raising program – its first since the coronavirus pandemic began. Qantas shares were placed in a trading halt on Thursday when the announcement was made. Friday saw a return to trading when the company announced that $1.36 billion had been raised from institutional shareholders at a cost of $3.65 per share. Existing retail shareholders also have the opportunity to participate in the program. Qantas shares plunged 9.5% during Friday's trade to end the week at $3.81.

It was perhaps fortuitous timing for Qantas. ASX travel shares were amongst the hardest hit last week over coronavirus concerns. Webjet Limited (ASX: WEB) shares were down more than 15% over the week. Corporate Travel Management Ltd (ASX: CTD) didn't fare any better, with its shares down nearly 19% for the week.

Meanwhile, ASX blue chips were the shares holding the fort. CSL Limited (ASX: CSL) shares were up 1.6% for the week, with 2 of the big four ASX banks, Wesfarmers Ltd (ASX: WES) and Coles Group Ltd (ASX: COL) also posting weekly gains.

How did the markets end the week?

It was a week of volatility on the ASX 200 last week, with frequent, large swings in intra-day trading occurring. Monday and Tuesday saw this volatility in play but only recorded 0.03% and 0.2% gains respectively. Wednesday backed up Tuesday with another 0.2% gain, but then Thursday brought a nasty 2.5% loss. Friday saw this loss reverse somewhat with a 1.49% gain. But it wasn't enough to offset the rest of the week. In the end, the ASX 200 started last week at 5,942.6 points and concluded at 5,904.1 points – putting the week's loss at 0.65%.

Meanwhile, the All Ordinaries (INDEXASX: XAO) had a slightly worse time last week, starting at 6,061.6 points and finishing up at 6,011.8 points for a 0.82% loss.

Which ASX 200 shares were the biggest winners and losers?

It's that time of the report where we put the kettle on and have a gossip over last week's best and worst performers. As always, we'll start with the losers:

It was a dramatic week on the wrong side of the ASX last week, with some big double-digit losses. Mesoblast took out the wooden spoon though. This ASX biotech company's shares took a dive, despite no major news out of the company. It's possible investors were just taking some profits off the table after Mesoblast's incredible run over the past 3 months. As at 19 June, the company's shares were up more than 270% since 23 March.

We've already discussed the woes of ASX travel shares like Corporate Travel Management, whilst Ooh!Media shares have been under selling pressure ever since the company gave investors a less than uplifting trading update earlier in the month. The outdoor advertising business has been struggling since the onset of the pandemic which resulted in deep cuts to advertising expenditure across the economy.

Let's now take a look at the winners from last week:

Last week's winners' list was dominated by ASX resources shares. The gold medal went to Western Areas, a nickel miner based in South Australia. The company released some positive results from its Western Gawler project, which seems to have been the catalyst for these strong gains.

ASX gold miner Saracen came in at second place. Gold prices have been on the rise in recent weeks (reaching 8-year highs), which has resulted in higher valuations for most gold miners. Sandfire Resources, which produces gold as well as copper, was likely experiencing buying pressure for similar reasons.

What is this week looking like for the ASX 200?

In my view, it's likely to be (yet another) week dictated by the trajectory of the coronavirus. If signs emerge that the virus looks to be heading towards a 'second wave' (particularly in Victoria), then the markets might possibly continue to shed value.

Also worth keeping an eye on is the turbulence over in the US. Like it or not, the US markets play a huge role in dictating the direction of our own ASX. And there has certainly been a lot of tumult across the Pacific. Several US states, including Florida and Texas, are reimposing lockdown restrictions (after initially easing off) in response to a spike in infection rates. This could well lead to pessimism on the US markets as well as our own.

So before we embark on another week, here's a quick look at how the major ASX blue chip shares are looking: