The Australian share market opened lower and sunk almost 1 per cent after the release of weaker than expected growth figures, but lifted from lows by session’s end to close 0.6 per cent down. Losses were accelerated in the resources sector with iron ore miners under pressure as the price for the steel making commodity continues to weaken.
The S&P/ASX 200 index dropped 25 points to finish at 4,279. On the futures market the SPI is 34 points down.
Economic news
Australia’s economy grew less than expected between April and June 2012: The Australia Bureau of Statistics has reported gross domestic product lifted 0.6 per cent in the June quarter and 3.7 per cent over the year to June. GDP rose 1.3 per cent in the March quarter.
Australia's services sector shrunk for the seventh straight month in August: The Australian Industry Group and Commonwealth Bank Performance of Services Index dropped 4.1 points to 42.4 in August, below the 50 level indicating contracting activity.
Company news Macquarie Group Limited
(ASX:MQG) is reportedly being threatened with sanctions from The Australian Securities & Investments Commission (ASIC) after the regulator identified compliance failures. While both organisations have refused to comment on the reports Fairfax Media says ASIC is currently investigating the private wealth division of Australia’s largest investment bank. Shares in Macquarie Group dipped 0.07 per cent today, closing at $27.27.
In the wake of News Corp’s
(ASX:NWS) UK phone hacking scandal its Chairman Rupert Murdoch and three senior executives have agreed to cut a portion of their bonus entitlements to shoulder some of the costs. A proxy statement filing in the US has revealed the top executives will together forgo about $US5.6 million to share a portion of expenses incurred from the scandal. Shares in News Corp rose 1.18 per cent today, closing at $23.22.
Iron ore miner Fortescue Metals Group Limited
(ASX:FMG) has sold its Solomon power station in the Pilbara region of Western Australia for $US300 million and inked a long term power purchase agreement with the Canadian buyer.
BHP Billiton Limited
(ASX:BHP) has outlined plans to invest $US6.5 billion in an effort to boost petroleum production by 8 per cent in the current financial year.
Global miner Rio Tinto Limited (ASX:RIO, NYSE:RIO, LON:RIO) will gain $151 million in cash now it has completed the sale of the North American part of its Alcan Cable business.
Energy company Linc Energy Limited
(ASX:LNC) has maintained its full year Gulf Coast production guidance after Hurricane Isaac swept over the region.
Best and worst performers
The best performing sector was health care adding 216 points to close at 10,419.
The worst performing sector was materials, losing 169 points to close at 9,073 points.
The best performing stock in the S&PASX 200 was Saracen Mineral Holdings Limited
(ASX:SAR), rising 6.85 per cent to close at $0.39. Shares in Intrepid Mines Limited
(ASX:IAU) and CSL Limited
(ASX:CSL) also closed higher.
The worst performing stock was Sundance Resources Limited
(ASX:SDL), dropping 13.11 per cent to close at $0.27. Shares in Boart Longyear Limited
(ASX:BLY) and Gindalbie Metals Limited
(ASX:GBG) also closed lower.
Commodities
Gold is trading at $US1,694 an ounce.
Light crude is $0.93 down at $US95.28 a barrel.
The Australian dollar
The Australian dollar is buying $US1.019.
