The Australian share market has closed sharply lower after spending the day in negative territory, with mining and financial stocks weighing. All the major sectors shed over 1 per cent in a bleak trading day that got off to a poor start on US stimulus fears.
The S&P/ASX 200 index closed 94 points down to finish at 5,011. The value of trades was $4.6 billion on volume of 813 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 ANZ Banking Group
(ASX:ANZ).
On the futures market the SPI is 95 points down.
Economic news
Construction activity has fallen for the 38th straight month, however the pace of decline has moderated somewhat. The Australian Industry Group-Housing Industry Association Australian Performance of Construction Index (PCI) rose 4.6 points to 44.1 in July. A reading below 50 indicates decline, however the month saw solid improvements in house building and engineering construction.
The Australian Bureau of Statistics has released housing finance data for June, revealing a 2.7 per cent rise. There were 51,001 approvals in the month, up from 49,642 in May. The result slightly surpasses economist expectations of a 2 per cent rise. Total housing finance by value increased by 2.1 per cent to $23.69 billion.
Company news
Australia and New Zealand Banking Group
(ASX:ANZ) has raised $1.12 billion in a capital notes offer after twice increasing the size of the deal from $750 million. The bank says the raising was part of its ongoing capital management strategy, with the proceeds slated for "general corporate purposes". Shares in ANZ closed 2.22 per cent down at $29.10.
BWP Trust
(ASX:BWP) will enter a trading halt pending the announcement on a potential equity raising, following a media inquiry that indicates confidentiality may have been lost in relation to an incomplete proposal for a potential equity raising. The halt will remain in place until the start of trade on Friday August 9 or when the announcement is released, whichever is earlier. Shares in BWP closed 0.42 per cent up at $2.41.
Fortescue Metals Group Limited
(ASX:FMG) has had its challenge over the legality of the Federal Government’s minerals resource rent tax dismissed by the High Court of Australia.
Karoon Gas Australia Limited
(ASX:KAR) is raising $150 million through an underwritten placement to help shore up its balance sheet amid farmout talks.
FlexiGroup’s Limited
(ASX:FXL) cash net profit for the full year has lifted 18 per cent to $72 million, helped by a diversified mix and continued expansion in receivables after the purchase of One Credit last year.
BHP Billiton Limited
(ASX:BHP) chief Andrew Mackenzie has called for a rethink of industrial relations policy and greater consultation on productivity to shore up the miner's operations against growing competition from emerging suppliers.
Best and worst performers
All major sectors finished in the red. The sector with the fewest losses was Real estate investment trusts dropped 11 points to close at 1,016.
The worst performing sector was Materials, losing 235 points to close at 9,276 points.
The best performing stock in the S&PASX 200 was Billabong International Limited
(ASX:BBG), rising 10.11 per cent to close at $0.49. Shares in Singapore Telecommunications Limited
(ASX:SGT) and Reject Shop Limited
(ASX:TRS) also closed higher.
The worst performing stock was Sirius Resources N.L.
(ASX:SIR), dropping 9.3 per cent to close at $2.34. Shares in Emeco Holdings Limited
(ASX:EHL) and St. Barbara Limited
(ASX:SBM) also closed lower.
Commodities
Gold is trading at $US1,277 an ounce. Light crude is $0.03 down at $US105 a barrel.
The Australian dollar
The Australian dollar is buying $US0.8964.
