The local share market has taken a dive today and is trading at near 10 month lows as investors dumped riskier assets on fears that Europe’s debt crisis will hurt global growth. The Australian share market looks set for its worst week since the height of the global financial crisis in mid-November 2008. Health stocks like Sonic Healthcare are leading the declines after resignations, downgrades and takeover approaches rattled the sector.
The S&P/ASX200 index is 101 points lower at 4,215 and on the futures market, the SPI200’s down 80.
In company news: Iron ore explorer Brockman Resources Ltd (ASX:BRM) has placed its shares in a trading halt pending the release of its response to market speculation over arrangements with China’s Sinosteel. Last month the company announced that it had signed a memorandum of understanding with Sinosteel for the purchase of up to 50% of the total production of Brockman’s flagship Marillana project. The company expects to make an announcement on Monday May 24. Shares in Brockman Resources last traded at $2.61.
Mortgage lender Rock Building Society Ltd (ASX:ROK) has downgraded its full year earnings guidance due to increased funding costs as a result of a rise in competition for retail deposits. Rock says it now expects net profit after tax for the year to be within the range of $4.9 and $5.1 million. This compares to previous guidance of between $5 and $5.3 million provided in February. Shares in Rock Building Society dropped 5.45% to $2.60.
Turning now to indices: All sectors are deep in the red at midday, however the sector posting the smallest loss is the Utilities index, down 39 points at 4,084. Shares in Energy Developments are 0.8% higher at $2.51. Shares in AGL Energy are higher while shares in Challenger Infrastructure Fund are down slightly at noon.
The worst performing sector is the Health Care index, down 400 points to 8,010. Shares in Sonic Healthcare plummeted 19.33% to $10.18 after downgrading its 2010 profit guidance, while shares in Mesoblast and Biota Holdings are also lower.
Looking to New Zealand and the NZSX50 is down 75 points. Taking a look at the top 4 stocks by turnover: Telecom of New Zealand tops the list with stock down 3.41% at $1.98, followed by; Sky City Entertainment Group, ANZ, and Auckland Airport.
To gold and the dollar: Gold is trading at US$1,168.75 an ounce and the Aussie dollar is trading at 82.13 US cents.
