Struck with negative leads the Australian share market today dropped 2.8 per cent to finish below 4,000. After losing more 13 per cent in the last quarter the sell-off continued on low volume, given the Labour Day public holiday in New South Wales, South Australia and the ACT. The banks fared the worst on news that debt-laden Greece will miss a deficit target. The miners also tumbled as commodity prices took a hit on fears of a slowdown in China.
The S&P/ASX200 Index today fell 112 points to close at 3,897. On the futures market the SPI is currently 111 points down.
Economic news
Manufacturing activity in Australia contracted last month. According to the Australian Industry Group and PriceWaterhouseCoopers, the performance of manufacturing index dropped 1 point to 42.3 in September, under the 50-level that separates contraction and expansion.
Consumer prices in Australia edged up last month. According to TD Securities and the Melbourne Institute the monthly inflation gauge added 0.1 per cent in September, following a fall of 0.1 per cent the month before.
Company news
Agribusiness Elders Limited (ASX:ELD) has flagged more than $50 million in writedowns and forecast an underlying net profit of between $1 million and $5 million in the 2011 financial year. The guidance has been cut from a profit of up to $30 million forecast in March and a first half loss of $14.6 million booked in May. Elders says it expects to provide the ASX with more material information on the progress of sales, value adjustments, impairment amounts and anticipated costs and charges, when the figures have been reliably determined. Shares in Elders fell 5.17 per cent today, closing at $0.275.
Nathan Tinkler’s Aston Resources Limited (ASX:AZT) has conditionally agreed to sell a further 10 per cent of its Maules Creek coal project in New South Wales. The coking-coal developer will gain $370 million from selling the stake to Japanese company, J-Power Australia Pty Ltd. The funds will go into developing the project that hopes to be producing by 2013. Shares in Aston Resources eased 0.99 per cent today, closing at $9.96.
Reports have emerged that China’s Hanlong Mining has increased its takeover bid from $0.50 to $0.57 cents per share, for Africa-focused iron ore developer Sundance Resources Limited (ASX:SDL). Sundance today entered into a trading halt, it said in order to prepare on update on Hanlong’s proposed takeover.
Agricultural chemicals supplier, Nufarm Limited (ASX:NUF), today announced the appointment of Peter Margin as a non-executive director of the company. Mr Margin was the CEO of food manufacturer Goodman Fielder Limited (ASX:GFF) from 2005 until April 2011.
Shares in Aditya Birla Minerals Limited (ASX:ABY) fell after the copper miner said it had been fined for a breach of environmental requirements at its Mt Gordon mine in Queensland.
The board of Bow Energy Limited (ASX:BOW) today unanimously backed the improved $1.52 per share takeover offer from Arrow Energy Holdings Pty Ltd, that values that coal seam gas explorer at around $524 million.
Best and worst performers
Most sectors finished in negative territory: The best performing sector was Health Care, adding 12 points to close at 7,617. The worst performing sector was Financials Excluding Real Estate Investment Trusts, dropping 151 points to close at 4,204.
The best performing stock in the S&P/ASX200 was Extract Resources shares rose 1.18 per cent to close at $7.72. Shares in CSL and Oceana Gold also closed higher. The worst performing stock was Murchison Metals, falling 14.93 per cent to close at $0.285. Shares in Energy World Corporation and Aquarius Platinum also fell heavily today.
Commodities
The price of gold is $US1,631 an ounce. Light crude is down $0.96 cents at $US78.24 a barrel.
