Market Wrap: Stocks close deep in the red

Market Reports

Aussie stocks have closed firmly in the red today with all sectors of the market closing weaker after fraud charges brought against Goldman Sachs and the closure of airspace over the Eurozone dented investor sentiment. The airlines like Qantas and Virgin Blue took a hit from the flight ban across Europe with financial stocks like major banks Commonwealth Bank and NAB among the hardest hit with the Goldman Sachs news. The S&P/ASX 200 Index closed the day 70 points lower at 4,915. While on the futures market, the SPI200’s down 84. In economic news: The HIA/RP Data residential land report for the December quarter showed that the weighted median price of a vacant housing block rose by 2.2% in the quarter to $185,222. Over the year to December 2009, the weighted median land price jumped 14%, the fastest annual rate since mid-2004. Sydney had the most expensive median price of residential land, at $275,000 with the cheapest market in the northern region of South Australia. To company news around this afternoon: Qantas Airways Ltd (ASX:QAN) is reportedly losing up to $1.5 million a day as airspace over Europe remains closed due to ash coming from a volcanic eruption in Iceland. A Fairfax report says that the Centre for Asia Pacific Aviation has calculated that the cost of the closure of airspace over the Eurozone may cost the airline industry US$12 billion. Analysts at Citigroup are projecting that Qantas’ earnings before interest and tax could potentially fall between $1.5 million and $2 million for every day that it has to cancel flights. According to Fairfax Qantas says up to 60% of its losses are due to customer service costs like paying for accommodation of those affected by the cancellations. Qantas shares closed 2.01% weaker at $2.92. Coal upgrader White Energy Company Ltd (ASX:WEC) is to make an offer made up of mostly shares for private company South Australian Coal. White Energy says its offer to acquire 100% of the coal company is for an upfront consideration of $39.3 million, which will result in South Australian Coal shareholders receiving up to 15.7 million White Energy shares, based on a price of $2.50 a share. In addition South Australian Coal shareholders could receive up to a further 17 million White Energy shares subject to future positive coal exploration results. Former CEO of Felix Resources, Brian Flannery, will become CEO of White Energy from August 2010. Shares in White Energy closed 21.85% higher at $3.29. Also making news: Oil and gas company Nexus Energy Ltd (ASX:NXS) has appointed Richard Cottee as CEO. Most recently Mr Cottee held the position of managing director of Queensland Gas Company from 2002 to 2008. OM Holdings Ltd (ASX:OMH) and Consolidated Minerals Ltd are investigating a possible acquisition of an interest in Consolidated Minerals Woodie Woodie manganese operation in the Pilbara, Western Australia by OMH. Diversified services company UGL Ltd (ASX:UGL) has secured new freight rolling stock and wagon orders with Queensland-based rail operator, QR Limited, valued at $100 million. And ANZ Banking Group Ltd (ASX:ANZ) says it has completed the acquisition of The Royal Bank of Scotland’s Taiwan businesses and will operate them under a new Chinese name from today. In the best and worst performers: All sectors closed deep in the red today, however the sector with the smallest loss was the Telco Services index, down 3 points at 1,063. The sector with the biggest loss today was the Real Estate Investment Trust index; down 18 points at 872. The best performing stock in the S&P/ ASX200 was Riversdale Mining, shares rose 1.62% to $9.41, while shares in Ausenco and Kingsgate Consolidated closed higher. The worst performing stock was Boart Longyear, shares fell 5.63% to $0.335. Shares in Murchison Metals and Fortescue Metals also closed weaker today. In commodities, gold is trading at $1,135.65 U.S an ounce and light crude is down $1.29 to $81.95 U.S a barrel.

Are you a 708 sophisticated investor?

A sophisticated investor is defined under Section 708 of the Corporations Act (net assets of $2.5 million or annual incomes in excess of $250,000).

They are eligible to receive information regarding wholesale investment opportunities that are not available to regular or retail investors.

Please subscribe if you would like to be alerted to these types of opportunities.