Investors are reeling from gathering panic and the state of the global economy. Shares plunged at the opening, shedding $56 billion within minutes. After a brief moment of recovery, stocks took another tumble to even lower levels, the market dropping more than 4 per cent. Federal Treasurer Wayne Swan moved to calm nerves in Australia but to no avail. There isn’t a single stock in the ASX 200 trading in positive territory at noon.
The S&P/ASX200 index has plummeted 188 points and is 4,089 at noon. On the futures market the SPI is 191 points weaker.
Economic news
The Australian Industry Group – Housing Industry Association’s performance of construction index (PCI) rose 0.3 points to 36.1 in July. It was the 14th consecutive monthly contraction for the sector - with readings below 50.
And the Reserve Bank has slashed its domestic growth forecast for the year by 1 percentage point to 3.25 per cent.
Company news
Union workers have begun voting on whether or not to accept an offer by BHP Billiton Limited (ASX:BHP) to end a two week strike at the world’s top copper mine. BHP had defied the workers after resubmitting an offer they had already rejected. The union leader has told Reuters that the workers are split on making a decision. BHP shares have fallen 4.07 per cent to $38.43 at noon.
ResMed Inc (ASX:RMD) has increased full year net profit by almost 20 per cent, with net income rising to $US223 million for the year to June 30. That’s up from $US190 million a year earlier. The sleep disorder and breathing products supplier says it’s been looking at new opportunities to expand its share of the market. ResMed shares have fallen 1.1 per cent to $2.69 at noon.
Sectors
To the best and worst performers and all are trading in the red. The sector with the smallest losses is Telco Services, dropping 24 points to 995. Shares in Singapore Telecommunications Limited are flat, trading at $2.42. Shares in Telstra Corporation Limited and Hutchison Telecommunications (Aus) Limited are both lower.
The worst performing sector is Energy sliding 838 points to 12,988. Shares in Paladin Energy Limited have tumbled 10.2 per cent and trading at $2.20. Shares in Santos Limited and Woodside Petroleum Limited are also lower.
New Zealand
The NZSX50 is 82 points weaker.
Taking a look at the top four stocks by turnover, Telecom Corporation of New Zealand is at the top of the list with stock down 3.01 per cent at $2.575 followed by Westpac, Fletcher Building and AMP.
Gold and the dollar
Gold is trading at $US1,647 an ounce and the Australian dollar is buying $US1.0456 cents.
