It was a joyless day for the local market as a underwhelming Wall Street lead combined with a soft GDP reading to send the Australian share market 1.34 per cent lower. Materials and financial stocks both gave up significant ground in a session that was unkind to all bar the telco sector, which eked out some small gains.
The S&P/ASX 200 index closed 66 points down to finish at 4,835. The value of trades was $5 billion on volume of 1 billion shares at the close of trade. The top three stocks by value were BHP Billiton Limited
(ASX:BHP), Commonwealth Bank of Australia
(ASX:CBA) and National Australia Bank Limited
(ASX:NAB).
On the futures market the SPI is 60 points down.
Economic news
Activity in the Australian services sector has hit a 13-month low and its second lowest-reading since the global financial crisis in May, according to the AiG-Commonwealth Bank Australian Performance of Services Index for May fell 3.5 points to 40.6, with a reading below 50 showing the sector is contracting.
The Australian economy expanded below expectations in the March quarter, according to the Australian Bureau of Statistics. Gross domestic product (GDP) in the March quarter grew a seasonally adjusted 0.6 per cent. For the 12 months to March, GDP grew at 2.5 per cent.
Company news
Federation Centres Limited
(ASX:FDC) will sell half of its interests in a six asset shopping centre portfolio to fund manager Challenger Limited
(ASX:CGF) for $602 million. Managing Director Steven Sewell says the part ownership deal with Challenger- in which Federation will retain management of the centres- will reduce costs and support its credit rating. Shares in Federation Centres closed 0.41 per cent down at $2.45.
Virgin Australia Holdings Limited
(ASX:VAH) saw 120 million shares, roughly five per cent, snapped up today buy a mystery buyer via a dark pool operated by Deutsche Bank. Media speculation pointed at Etihad Airways as a potential buyer, however a spokesman from the airline was unable to confirm any knowledge of the $56 million trade. Shares in Virgin Australia closed 1.08 per cent down at $0.46.
BHP Billiton Limited
(ASX:BHP) has been fined as part-owner of one of the world's largest zinc and copper mines for a toxic slurry spill last year in Peru.
Macmahon Holdings Limited
(ASX:MAH) has been unexpectedly dumped by Cobar Management from its expansion project at the underground CSA copper mine in central western New South Wales and says its seeking clarification on the decision.
Treasury Wine Estates Limited
(ASX:TWE) has appointed Tony Reeves as its new Chief Financial Officer, following the resignation of Mark Fleming.
Atlas Iron Limited
(ASX:AGO) has responded to media speculation surrounding the alleged provision of infrastructure services, confirming it is in discussions with a range of existing and potential infrastructure providers, and is continuing to work with its partners to assess the viability of an independent port and railway in the Pilbara.
Best and worst performers
The best performing sector was Telco services adding 3 points to close at 1,611.
The worst performing sector was Financials excluding real estate investment trusts, losing 127 points to close at 6,070.
The best performing stock in the S&PASX 200 was Atlas Iron Limited
(ASX:AGO), rising 3.61 per cent to close at $0.86. Shares in Monadelphous Group Limited
(ASX:MND) and Silver Lake Resources Limited
(ASX:SLR) also closed higher.
The worst performing stock was Billabong International Limited
(ASX:BBG), dropping 6.52 per cent to close at $0.21. Shares in Qantas Airways Limited
(ASX:QAN) and Newcrest Mining Limited
(ASX:NCM) also closed lower.
Commodities
Gold is trading at $US1,404 an ounce. Light crude is $0.23 up at $US93.54 a barrel.
The Australian dollar
The Australian dollar is buying $US0.9606.
