ASX slumps as miners lead losses

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Derek Rose
(Australian Associated Press)


Australian shares have closed in negative territory for a second day after a drop in the price of iron ore put pressure on mining shares.

The benchmark S&P/ASX200 index was down 19.5 points, or 0.32 per cent, to 6,165.3 points at 1615 AEDT on Wednesday, while the broader All Ordinaries was down 24.8 points, or 0.4 per cent, at 6,251.8.

“A bit of disappointment,” said Bell Direct equities analyst Julia Lee.

News that miner Vale SA had been given permission to restart production on a shuttered iron ore mine in Brazil caused future prices in the commodity to drop five per cent, Ms Lee said.

In turn shares of Australia’s miners tumbled, with the sector collectively down 1.36 per cent.

Rio Tinto was down 2.81 per cent to $92.09, BHP down 1.04 per cent to $37.20, and Fortescue Metals Group down 6.74 per cent to $6.36.

Tech stocks led gainers, up a collective 1.11 per cent, with Xero up 3.09 per cent to $50, Altium Limited up 2.89 per cent to $34.48, and Livetiles up 12.22 per cent to 50.5 cents, a five-month high.

The big banks were mixed, with Commonwealth Bank down 0.76 per cent to $70.79 and Westpac down 0.3 per cent to $26.34, while NAB gained 0.44 per cent to $25.07 and ANZ was up 0.19 per cent to $26.35.

Most of the action was among the smaller ASX players, with shares in Eclipx Group Limited plunging 55.97 per cent to 83 cents after a dismal earnings report that led McMillan Shakespeare to call off its proposed $1.6 billion merger with its automotive services peer.

Eclipx flagged a number of issues in a report to the ASX, including a 42 per cent decline in profit for the first five months of the fiscal year, processing errors on past fiscal years, and problems with its Right2Drive and Grays businesses.

Nufarm shares were down 23.92 per cent, to $4.23, after the agricultural company suspended its interim dividend following losses it blamed on drought conditions in Australia.

Platinum Asset Management shares dropped 11.09 per cent, to $4.89, after billionaire founder and controller Kerr Neilson and his wife Judith sold off a 10 per cent stake in the company for $300 million.

Thursday is shaping up to be a busy day for investors, with the US Federal Reserve releasing its “dot plots” on interest rates early in the day (Australia time) and then the Australian Bureau of Statistics releasing jobs data later in the day.

The Aussie dollar is buying 70.76 US cents, from 71.03 US cents on Tuesday.


* The benchmark S&P/ASX200 index was down 19.5 points, or 0.32 per cent, to 6,165.3 points at 1630 AEDT on Wednesday.

* The All Ordinaries was down 24.8 points, or 0.4 per cent, to 6,251.8.

* At 1630 AEDT, the SPI200 futures index was down flat at 6174.


One Australian dollar buys:

* 70.76 US cents, from 71.03 US on Tuesday

* 78.94 Japanese yen, from 79.00

* 62.36 euro cents, from 62.60

* 53.38 British pence, from 53.51

* 103.55 NZ cents, from 103.53


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