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Market Update

Australian Indexes Plunge 4% as Glencore Melts Down

Author: Marcus Jacob
Last Update: 2:11 PM ET September 29 2015

5:30 PM Sydney, Australia Ė Australian market indexes plunged 4% and dropped to a two-year low in active trading after an analyst report cited dire outlokk for shareholders. Arrium agreed to develop a port facility at the third largest city in South Australia.

Australian stocks tumbled and market indexes plunged nearly 4% after panic selling in resource sector dragged the benchmark index to a two-year low.

Australian resource stocks plunged after a critical report from an analyst Hunter Hillcoat at Investec in London, U.K. cited that Glencore shareholders could be wiped out if the current weakness in metal prices persists.

In London trading, Glencore recovered 8% after plunging as much as 30% in a few hours trading after the report was released.

In the year so far, Glencore stock is still down more than 75% as metal and energy prices continue to drift lower in international markets.

Australian dollar closed at 69.49 U.S. cents and in stock trading turnover jumped to 919.3 million shares worth $5.9 billion.

At close, the ASX 200 Index plunged 195.10 or 4% to 4,918.40 and the broader All Ordinaries Index slumped 187 to 4,958.10.

In commodities trading, gold dropped US$19 to US$1,127 an ounce and Brent crude future for immediate month delivery added 14 cents to US$47.48 a barrel.

Australian Stock Movers

Arrium Ltd slumped 5.5% to 0.086 cents after the company signed an agreement with the South Australian government to create a multi-user port at Whyalla, the third largest city in the state.

Dexus Property Group declined 4.1% to $7.06 after the real estate developerís subsidiary agreed to divest its office building located at 36 George Street, Burwood for a gross sales price of $95 million, reflecting a $29 million or 44% premium to book value.

The company said sale proceeds will be used to repay debt and the transaction is expected to close on November 23.

Kathmandu Holdings Ltd jumped 2.4% to $1.30 after the New Zealand-based outdoor clothing and equipment retailer said revenues in the year ending in July jumped 4.2% from a year ago to NZ$409.8 million.

Net profit in the year tumbled 51.7% to NZ$20.4 million compared to NZ$42.2 million and diluted earning per share dropped to 10.1 cents from 20.8 cents.

OceanaGold Corporation plummeted 5.3% to $2.15 after the gold producerís 79.67% of stockholders approved the acquisition of Romarco Minerals.

The company is now awaiting final order from the Supreme Court of British Columbia, Canada before the end of this month.

Under the terms, Romarco shareholders will receive 0.24 per shares of Oceana.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc