Following negative leads, as fears of a global slowdown intensified, the Australian share market dropped steeply at open. Sinking as much as 5 per cent in morning trade, the ASX has now hit levels not seen since height of the Global Financial Crisis. Falls across the board have accelerated, with the gold miners among the few stocks to buck the trend. The Australian dollar has dipped to a five-month low.
Figures
The S&P/ASX200 index has shed 164 points to 3,822 at noon. On the futures market the SPI has sunk 170 points.
China economic news
The People's Bank of China has reported that the nation’s consumer price index increased 6.5 per cent in July from the year before. The jump has exceeded expectations and represents the highest rate it more than three years.
Local economic news
National Australia Bank’s business conditions survey has shown Australia’s economy grew at a below-trend rate in July. Last month business conditions fell by 3 index points to -1. In the same period business confidence lifted 2 points to +2 index points.
The Australian Bureau of Statistics has reported that home loan commitments remained unchanged in June. Despite forecasts of a rise, the number of loans came in at 49,175 in the month, just eight more the month before.
Company news
Westpac Banking Corporation (ASX:WBC) has today followed in the footsteps of its rival Commonwealth Bank of Australia (ASX:CBA) and cut its mortgage rate. Westpac has sliced 20 basis points off its fixed mortgage rate on three-year loans to 6.79 per cent. The move comes just a few hours after CBA this morning said it would slash its fixed home loan rate by up to 60 basis points for its one to five-year loans to between 6.59 per cent to 6.99 per cent. Shares in Westpac have fallen 2.81 per cent and are trading at $18.31.
Western Australia’s Premier Colin Barnett says Lynas Corporation Limited’s (ASX:LYC) rare earths ambitions are safe to proceed in the state. The comments come amid lingering controversy surrounding the environmental impact of the project, which will see containers of rare earths concentrate extracted at Mt Weld and trucked to the port of Fremantle for shipping to Lynas’ Malaysian refinery. Mr Barnett says the state has carefully looked at the Mt Weld project and that the level of radioactivity is so low it doesn’t show up or classify as a dangerous good in terms of transport. Shares in Lynas Corporation have dropped 4.17 per cent and are trading at $1.725.
Best and worst performers
All sectors have fallen deeply into the red: The sector with the smallest losses is Real Estate Investment Trusts, falling 17 points to 709. Shares in CFS Retail Property Trust have added 1.12 per cent and trading at $1.532. Shares in Westfield Retail Trust are higher, but shares Dexus Property Group have eased. The worst performing sector is Energy shedding 740 points to 11,987. Shares in Roc Oil Company have plunged 13.56 per cent and trading at $0.255. Shares in Aquila Resources and Carnarvon Petroleum have also sunk.
New Zealand
The NZSX50 has tumbled 123 points. Taking a look at the top four stocks by turnover, Telecom Corporation of New Zealand is at the top of the list with the stock retreating 4.63 per cent at $2.37 followed by Fletcher Building, Sky City Entertainment Group and Westpac.
Gold and the dollar
Gold is trading at $US1,740 an ounce. The Australian dollar is buying $US1.0045 cents.
