The Australian share market has had a poor start to fiscal 2014, closing 1.9 per cent down after a day spent in negative territory, with all the major sectors finishing down. Things went from bad to worse on weak Chinese manufacturing data which rekindled slowdown fears.
The S&P/ASX 200 index closed 92 points down to finish at 4,710. The value of trades was $4 billion on volume of 647 million shares at the close of trade. The top three stocks by value were Commonwealth Bank of Australia
(ASX:CBA), BHP Billiton Limited
(ASX:BHP) and ANZ Banking Group
(ASX:ANZ).
On the futures market the SPI is 85 points down.
Economic news
Manufacturing activity in China slowed down in June, falling 0.7 points to 50.1, just above the point of contraction according to the HSBC manufacturing purchasing managers index.
The Australian Industry Group says the manufacturing sector nudged growth in June, rising 5.8 points to 49.6. The Index is now just below the 50 threshold that seperates contraction and expansion in the sector.
The TD Securities-Melbourne Institute’s monthly inflation gauge was subdued in June, coming in flat following a 0.3 per cent increase in May. For the 12 months to June, the inflation rate was 2.4 per cent.
The RP Data-Rismark Home Value Index says capital city home values saw a rise of 3.8 per cent over the last financial year, bouncing back from a 3.6 per cent fall in fiscal 2012.
Company news
Drug development company Phosphagenics Limited
(ASX:POH) shares slumped 19.23 per cent after it suspended chief Esra Ogru from duties after discovering irregular transactions in relation to company invoicing and accounting records.
Wesfarmers Limited
(ASX:WES) shares slipped 2.55 per cent after supermarket chain Coles has been fined just over $61 thousand for selling imported fruit advertised as having been grown in Australia.
Troy Resources Limited
(ASX:TRY) saw some firm gains after executing documentation to finalise its $40 million loan facilities with Investec bank.
Rural property owner PrimeAg Australia Limited
(ASX:PAG) struck a $45 million deal to sell the last of its shares to private agricultural company Australian Food and Fibre. Primeag will also offload its remaining assets and delist from the sharemarket.
Origin Energy Limited
(ASX:ORG) eased 3.1 per cent as it announced it will pay $659 million for state-owned generator Eraring Energy as part of the New South Wales government's $3 billion power sell-off. The state will also pay Origin $300 million to cancel a 17 year coal supply agreement.
Mining services provider Boart Longyear Limited
(ASX:BLY) shares fell 7.4 per cent after a caution that full year earnings are set to be weaker amid difficult market conditions, particularly in its Drilling Services business.
Best and worst performers
All the major sectors finished lower: The fewest losses were in Materials, dropping 96 points to close at 8,383.
The worst performing sector was Real estate investment trusts, losing 20 points to close at 1,010.
The best performing stock in the S&PASX 200 was Alacer Gold Corp - CDI
(ASX:AQG), rising 10.34 per cent to close at $2.24. Shares in Perseus Mining Limited
(ASX:PRU) and Northern Star Resources Limited
(ASX:NST) also closed higher.
The worst performing stock was Discovery Metals Limited
(ASX:DML), dropping 11.11 per cent to close at $0.12. Shares in Ausdrill Limited
(ASX:ASL) and Mineral Deposits Limited
(ASX:MDL) also closed lower.
Commodities
Gold is trading at $US1,244 an ounce. Light crude is steady at $US96.56 a barrel.
The Australian dollar
The Australian dollar is buying $US0.9196.
