Market Wrap: Aus shares wiping out 2013 gains

Market Reports

Retreating from the year’s strong start the Australian share market dropped 1.5 per cent today to again touch the year’s lows. Local stocks extended losses ahead of Wall Street’s new trading week, amid expectations stronger US economic data could speed up the Federal Reserve’s timeline to wrap up its stimulus program. China’s cash squeeze continued to unnerve investors, with mining and energy sector retreating steeply and ex-dividends also bringing the bourse down. 

Figures

The S&P/ASX 200 index sank 70 to finish at 4,669. 

The value of trades was $4.1 billion on volume of 807 million 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 AMP Limited (ASX:AMP)

On the futures market the SPI is 59 points lower.

Economic news

The growth of new dwellings in mining areas is expected to slow next year while lifestyle areas are poised for a pick up, according to BIS Shrapnel. The forecaster’s Regional Building 2013-2015 report says the top spot for new buildings next year will be the Coffs Harbour-Grafton area in the north coast of New South Wales, with expected building growth of 52 per cent. On the opposite end of the scale, new buildings in Alice Springs are expected to fall by 43 per cent in the next financial year.  
 
Company news

Gaming companies Tatts Group Limited (ASX:TTS) and Tabcorp Holdings Limited (ASX:TAH) have scored a victory against the Victorian government. The court win will see both companies avoid more than $40 million in charges as part of a levy on gaming machines the companies no longer operate. Despite the news shares in Tatts Group ended 0.64 per cent down at $3.09. 

Leighton Holdings Limited (ASX:LEI) subsidiary has secured its largest ever single contract award on the same day the construction giant has completed refinancing. Pilbara-focussed iron ore miner Fortescue Metals Group Limited (ASX:FMG) has boosted the value of Leighton Contractor’s existing contract by $1.3 billion contract to $2.8 billion. Leighton also today secured $1 billion in commitments for a syndicated cash advance facility. Shares in Leighton Holdings closed 1.12 per cent down at $14.95. 
 
Shares in AMP Limited (ASX:AMP) slumped 12.85 per cent after the wealth manager issued a profit warning following poor claims and losses in its wealth protection business. 
 
Shares in Metcash Limited (ASX:MTS) climbed 4.94 per cent after boosting its annual underlying net profit by almost 7 per cent, with growth in new businesses offsetting softness from its core groceries distribution division.  

Rio Tinto Limited (ASX:RIO) has opted to maintain exposure to diamonds after a review revealed robust market fundamentals on the back of demand from Asia and North America. The global mining company’s stock closed 2.13 per cent lower.  

Shares in Prima BioMed Limited (ASX:PRR) jumped 11.43 per cent before the biotechnology company entered into a trading halt to prepare an announcement regarding the extension of clinical trials for its flagship product candidate.  

Best and worst performers

Health care was the only sector to avoid finishing in the red, adding 120 points to close at 12,722.
The worst performing sector was materials, losing 260 points to close at 8,401 points.

The best performing stock in the S&P/ASX 200 was Metcash Limited (ASX:MTS), rising 4.94 per cent to close at $3.61. Shares in Westfield Retail Trust (ASX:WRT) and Cabcharge Australia Limited (ASX:CAB) also closed higher.

The worst performing stock was Linc Energy Limited (ASX:LNC), dropping 18.26 per cent to close at $0.94. Shares in Sirius Resources NL (ASX:SIR) and Medusa Mining Limited (ASX:MML) also closed lower. 
 
IPOs

iSelect Limited (ASX:ISU) started trading today. The insurance comparison group floated with an issue price of $1.85, opened at $1.76 and dropped more than 15 per cent over the session to end its first day of trade at $1.56.    

Commodities

Gold is trading at $US1,284 an ounce.
Light crude is $0.43 down at $US93.26 a barrel.

The Australian dollar

The Australian dollar is buying 91.83 US cents. 

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