The market is having a horrid day – down 217 or 5.1% - on the back of heavy falls on Wall Street overnight. The SFE Futures predicted a 301 point fall this morning. All sectors well down, resources underperforming – down 9.4% - led by the big boys BHP down 9.8%, Rio Tinto down 13.7% and Fortescue Metals down 10.4%. 54 stocks among the All Ords have hit fresh yearly lows.
Dow down 733– or 7.9%. Downward trend all session – down 780 at worst. S&P500 down 9.03%. Nasdaq down 8.5%. All gains from the massive rally on Monday 13th have all but been wiped out the last 2 sessions - the S&P500 is only up 1% for the week. The MSCI World Index down 7.3% - FTSE down 7.16%, DAX down 6.49%, CAC 40 down 6.82%, Nikkei up 1.06%, Hang Seng down 4.96%.
US Stocks had their biggest fall since the 1987 crash after the largest drop in retail sales for three years and a record low manufacturing number confirmed the worst fears for a US recession. The focus has moved from the financial stabilization packages to the first quarterly fall in consumer spending in 17 years. The US GDP number is two thirds comprised by consumer spending. Economic releases were compounded by a depressing speech on the outlook from Bernanke. Energy sector fell the most – down 15.5% - on a recession led fall in the oil price. Oil down 5%, gold down a touch. Bonds up. Resources down 12.1% and commodities down 4.5% overall. BHP and RIO hammered – down 17.15% and 20.48%. Exxon Mobil and Chevron both down over 12%. The defensive sectors outperformed relatively - consumer staples and healthcare were down only 6.0% and 6.7%. The A$ down against the US dollar. US dollar up against the Euro. JP Morgan, Coca-Colaand Intelall beat quarterly earnings expectations. CCL one of the only companies up – rose 1.1%.
* Both BHP and RIO down significantly in ADR form overnight, 17.15% and 20.48% respectively.
* Metals all smashed overnight – Copper, Nickel and Zinc all down over 7%. Aluminium down 5.04%.
* Oil price down $4.31 to $74.38 – below $75 a barrel for the first time in 14 months – after OPEC cut its 2009 petroleum forecast.
* Gold down 50c to $839
* US Bond up with the 10 year yield down to 3.97%.
Copyright Australasian Investment Review.
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