The stockmarket lost $27billion and fell to a five-year low yesterday as new data showed plummeting business profits revived talk the country has already entered a recession.

However, economists are unsure how the Reserve will react, saying it will be a ''near coin toss'' as to whether it will deliver another reduction today or keep rates on hold while waiting to see how its previous big cuts and the Government's stimulus packages work.

The central bank has already slashed the cash rate by 400 basis points since September to a 45-year low of 3.25 per cent.

Ahead of tomorrow's national accounts figures, Treasurer Wayne Swan said yesterday that seven of Australia's top-10 trading partners were in recession which would ''have a dramatic impact on growth in Australia in the December quarter''.

''It's very important as we go through this period to understand that if you were going to be in any country in the world in this situation, Australia is where you would want to be, but we're certainly not immune from this global recession,'' he said.

The warning came as more companies shed workers. Anglo Coal Australia said it would cut 650 mining jobs across Queensland and NSW and Melbourne car parts maker Robert Bosch is axing up to 170 jobs.

Other developments undermining the economy yesterday included:

The Australian Industry Group-PricewaterhouseCoopers performance of manufacturing index falling for the ninth consecutive month;

Moody's Investors Service downgrading to negative the ratings outlook for ANZ Bank, the Commonwealth Bank and Westpac;

Worse-than-expected Australian Bureau of Statistics business indicators figures, showing a 6.5per cent seasonally adjusted fall in company profits which would have been a 11.3per cent collapse if mining was not included and a 1.9per cent drop in inventories in the December 2008 quarter. Economists had expected 1per cent and 1.9per cent declines for profits and inventories respectively.