The Australian share market closed 1.98 per cent lower in a day of steep declines that wiped close to $30 billion of the value of the market. A slew of disappointing news including the tumbling oil price, a falling Aussie dollar, Swiss resistance to upping their gold stocks and slowing growth in China’s factory sector sent investors scrambling for the sell button.
In China, the Purchasing Managers’ Index or PMI slipped to 50.3 in November from 50.8 in October well below analyst expectations of 50.6.
The S&P/ASX 200 index closed 105 points down to finish at 5,208.
The value of trades was $4.99 billion on volume of 985 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 123 points down.
Economic news
Corelogic RP Data research is indicating a slowdown in capital city house prices is underway. Nationally, prices dipped 0.3 per cent despite Sydney posting a rise of 1 per cent with Perth not far behind. Year-on-year growth is currently 8.5 per cent across the nation.
The TD Securities-Melbourne Institute monthly inflation gauge has lifted 0.1 per cent in November slowing from a 0.2 per cent rise in October. The annual pace of inflation has now dipped to 2.2 per cent from 2.3 per cent.
Company news
Ten Network Holdings Limited
(ASX:TEN) has announced the immediate resignation of director Paul Mallam ahead of the broadcaster’s expected takeover offer from Discovery Communications and Foxtel. Mr Mallan was nominated to the board by Ten’s largest shareholder, billionaire Bruce Gordon. In a release to the ASX, Mr Mallam said he would like to pay tribute to his fellow directors and also praised the management and staff at TEN. Discovery and Foxtel are believed to be preparing to lodge a joint takeover bid of between 25c and 30c per share for the ailing television network. Shares in Ten Network added 4.08 per cent to $0.26.
The owner of IGA supermarket’s Metcash Limited
(ASX:MTS) has vowed to push ahead with its transformation despite a fall in its first half profit. The grocery wholesaler’s underlying net profit dropped 9 per cent to $101.7 million in the six months to the end of October. CEO Ian Morrice says the grocer’s transformation plan is now gaining momentum and the company is very encouraged by initial indicators. Looking ahead Metcash expects to deliver annual earnings before interest and tax of between $315 and $330 million in the full 2015 financial year. Shares in Metcash have slid 16.48 per cent to $2.18.
Pacific Energy Limited
(ASX:PEA) is on the hunt for a new CEO after announcing current Managing Director Adam Boyd will step down in March 2015.
Senex Energy Limited
(ASX:SXY) is celebrating first commercial gas sales
from the Hornet field in the Cooper Basin.
Sedgman Limited
(ASX:SDM) has scored a $133 million EPC contract for a project at the Groote Eylandt Mining Company Manganese Mine.
Suncorp Group Limited
(ASX:SUN) says it has received thousands of claims following storms in Brisbane last Thursday which were described as the worst to hit the city in 30 years.
Best and worst performers
The best performing sector was real estate investment trusts adding 0.15 per cent to close at 1,154. The worst performing sector was energy, losing 6.41 per cent to close at 11,049 points.
The best performing stock in the S&P/ASX 200 was Qantas, which will benefit from a falling oil price, the stock rising 4.69 per cent to close at $2.01. Shares in Ten Network and Pacific Brands also closed higher.
The worst performing stock was Liquified Natural Gas, dropping 22.46 per cent to close at $2.52. Shares in PanAust and Evolution Mining also closed lower.
Commodities
Gold is trading at $US1,152 an ounce. Light crude is $7.54 down at $US66.15 a barrel. The Australian dollar is buying 84.56 US cents.
