Midday: Energy stocks send ASX sharply lower

Market Reports

Following a plunge in the oil futures when OPEC refused to address the global oils supply glut energy stocks have sent the Australian share market sharply lower with the index 1.3 per cent weaker at noon. Santos has been hardest hit with gas and petrol producer down over 10 per cent in morning trade.  
 
The S&P/ASX 200 index is 71 points down at 5,330. On the futures market the SPI is 75 points lower. 
 
Company news 
 
Qantas Airways Limited (ASX:QAN) has seen a healthy rise in passenger numbers and announced an investment in Jetstar Japan ahead of its international launch. Passenger numbers for October increased 1.6 per cent on last year taking passenger numbers for the year to date up 2.7 per cent on the same period last year. In a separate announcement Qantas said it was providing an equity injection into Jetstar Japan to support the airlines growth as it prepares for the start of international flights early next year. Jetstar Japan, a joint venture between Qantas, Japan Airlines, Mitsubishi and Century Toyko Leasing Corporation, is the largest low cost carrier operating in Japan with almost 60 per cent of the market. A combined equity injection of $114 million will be shared equally by major shareholders Qantas and Japan airlines with key fundamentals for Jetstar Japan tracking ahead of schedule. Shares in Qantas are trading 4.32 per cent up at $1.87. 
 
Challenger Limited (ASX:CGF) has been informed by the Department of Social Services that it will reverse the means test assessment for Challenger’s Care Annuity. This will result in a reduction of the age pension paid to most of the DSS investors in the Care Annuity effective Jan 2015. Challenger says the original decision is correct and should not be reversed. Sales of the Care Annuity have been suspended until a resolution is reached with Challenger saying it cannot predict the effect the decision will have on its books and therefore it cannot confirm net book growth guidance. Care Annuity sales in the 2014 financial year were $279 million. Shares in Challenger have plunged 7.01 per cent to $6.37. 
 
 Best and worst performers

The best performing sector is real estate investment trusts, gaining 0.2 per cent to 1,155. Shares in Novion Property Group have risen 0.93 per cent and trading at $2.16. Shares Abacus Property and GPT Group are also stronger. 
 
The worst performing sector is energy, diving 7.1 per cent to 11,881 Shares in Senex Energy have tumbled 13.75 per cent, trading at $0.35. Shares in AWE and Sundance Resources are also lower. 
 
IPOs

eCargo Holdings Limited (ASX:ECG) started trading today. The eCommerce supplier floated with an issue price of $0.40, opened at $0.395 and is currently trading at $0.39.    

Gold and the dollar

Gold is trading at $US1,188 an ounce.
The Australian dollar is buying 85.16 US cents.