After negative leads, the Australian share market has sunk 1.4 per cent at noon. Reignited fears over Europe’s debt woes, now spreading to Italy, and America’s economic situation have weighed on investors, as the market also absorbs the impact of the federal government’s carbon tax.
The S&P/ASX200 index is fallen 64 points at 4,518 at noon. On the futures market the SPI is 63 points lower.
Economic news
National Australia Bank’s monthly business survey has shown confidence plunged from +6 points to zero in June. NAB blamed the result on the loss in economic momentum over the first half of this year and stalled asset prices. Business conditions added two points to +2 in the same month.
Company news
Shares in Macarthur Coal Limited (ASX:MCC) have soared almost 40 per cent this morning after the Queensland focussed coal miner received a joint takeover bid from Peabody Energy and ArcelorMittal. Shares in Macarthur traded at $11.08 before the company received a $15.50 per share offer to acquire at least 50.01 per cent of the company. Prime Minister Julia Gillard has used the bid to sell her carbon pricing scheme, claiming it cements the future of coal mining in Australia. Shares in Macarthur Coal have soared 36.91 per cent and are trading at $15.17 at noon.
The carbon tax could present a new revenue source for the operator of the Australian Securities Exchange, ASX Ltd (ASX:ASX). An ASX spokesperson has told The Australian Financial Review that it has well-developed exchange infrastructure and distribution mechanisms to support an Emissions Trading Scheme once the government’s carbon pricing policy is made. Carbon trading is expected to start in 2015 when the price will be set by the market through an Emissions Trading Scheme. ASX is facing rising competition from new players such as Chi-X who will enter the local market later this year. Shares in ASX are trading 0.71 per cent down at $30.68.
Sectors
All sectors are trading in the red. The sector with the smallest losses is Telco Services, easing 6 points to 1,029. Shares in Amcom Telecommunication have added 1.39 per cent and trading at $0.365. Shares in Telecom Corporation of New Zealand and Singtel are also higher. The worst performing sector is Health Care dropping 178 points to 8,191. Shares in Sonic HealthCare have dropped 3.27 per cent and trading at $12.12. Shares in Primary Healthcare and Ansell have also fallen.
New Zealand
The NZSX50 is 7 points lower. Taking a look at the top four stocks by turnover, Fletcher Building is at the top of the list with stock down 0.85 per cent at $8.17 followed by Telecom Corporation of New Zealand, AMP and Guinness Peat Group.
Gold and the dollar
Gold is trading at $US1,553 an ounce. The Australian dollar is buying $US1.0601 cents.
