The Australian share market dropped more than 1.5 per cent at open, weighed down by negative leads amid fears Greece’s political deadlock could result in the country leaving the eurozone. The miners have led the falls with the majors, BHP Billiton Limited (ASX:BHP), Rio Tinto Limited (ASX:RIO) and Fortescue Metals Group Limited (ASX:FMG) extending this week’s declines.
The S&P/ASX 200 index has shed 72 points and is 4,194. On the futures market the SPI is 83 points lower.
Economic news
Consumer confidence in Australia has edged up this month, but come in under expectations in the same month the Reserve Bank of Australia cut its official cash rate by 50 basis points. According to Westpac Banking Corporation (ASX:WBC) and the Melbourne Institute their survey of consumer sentiment increased 0.8 per cent to 95.3 index points in May, up from 94.5 last month but down 8.3 per cent from a year earlier. Westpac’s chief economist Bill Evans was disappointed with the read that he believes was impacted by disappointment the standard variable mortgage rate wasn’t reduced more than expected and increasingly disturbing news around Europe.
Movers at midday
Shares in Industrea Limited (ASX:IDL) have surged almost 50 per cent after backing a takeover bid from US-based General Electric. Under the scheme of arrangement, priced at $1.27 per share, the mining equipment manufacturer is valued at about $470 million. Industrea’s board has recommended shareholders vote in favour of the deal, in the absence of a superior proposal. The company has also today forecast its earnings will grow from last year, to between $125 million and $130 million in fiscal 2012. Shares in Industrea have surged 44.19 per cent and trading at $1.24.
Shares in Toll Holdings Limited (ASX:TOL) have slumped after the transport and logistics company warned its full year pre-tax earnings will fall from last year. CEO Brian Kruger says the company has seen continued pressure from the soft retail sector in Australia and weakness in the global apparel sector. Shares in Toll Holdings have slumped 12.54 per cent and are trading at $4.88.
Best and worst performers
The best performing sector is Utilities adding 3 points to 4,831. Shares in Energy World Corporation Limited (ASX:EWC) have risen 3.57 per cent and trading at $0.43. Shares in APA Group (ASX:APA) are higher while shares in Hastings Diversified Utilities Fund (ASX:HDF) are flat.
The worst performing sector is Materials, falling 314 points to 9,909. Shares in Aquarius Platinum Limited (ASX:AQP) have dropped 9.6 per cent, trading at $1.46. Shares in Atlas Iron Limited (ASX:AGO) and Fortescue Metals Group Limited (ASX:FMG) are also lower.
Gold and the dollar
Gold is trading at $US1,542 an ounce.
The Australian dollar
The Australian dollar is buying 99.35 US cents.
