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Market Update

U.S. and Europe Rate Jitters Drives ASX 200 Down 1.5%

Author: Marcus Jacob
Last Update: 8:59 AM ET December 04 2015

5:30 PM Sydney, Australia ASX 200 index declined following the weak market conditions in New York and in Europe in overnight trading. Australian dollar eased and in active trading resource stocks and banks led the decliners.

Stocks in Sydney opened lower and extended losses after markets across Asia declined on the weakness in New York and in Europe.

Investors have turned cautious after the central bank in the euro zone failed to expand its bond buying program and offer additional steps to lift inflation and support economic growth.

In addition, the U.S. Fed policymakers are scheduled to meet for a two-day meeting on December 15 and expectations are running high that rates may be revised higher for the first time in a decade.

The seasonally adjusted retail sales in October increased 0.5% to $24.66 billion and were unchanged from September and August readings, the Australian Bureau of Statistics reported.

The Australian dollar slid to 73.17 U.S. cents and in stock trading turnover fell to 808 million shares worth $5.3 billion.

At the market close, the ASX 200 Index dropped 76.10 or 1.5% to 5,151.60, while the broader All Ordinaries Index decreased 75.20 to 5,201.50.

For the week, ASX 200 slumped 1.1%.

In commodities trading, gold jumped US$9 to US$1,062 an ounce and Brent crude future for immediate month delivery edged down 2 cents to US$43.82 a barrel.

Australian Stock Movers

Superloop Ltd soared 8.5% to $2.30 after the communications infrastructure developer intends to set up fibre optic network in 110 kilometres in Hong Kong after it received an approval to build and operate communications infrastructure with an estimated cost of about $45 million.

The company raised $41.9 million through an institutional investor rights offering at an offer price of $1.90 per share.

Telstra Corp lost 1.8% to $5.41 on the news that the manager of its retail business unit, Karsten Wildberger, resigned in less than two months after assuming the office.

Virgin Australia Holdings Limited tumbled 2.2% to 44 cents, and the discount airline said it won the extension for its alliance with Abu Dhabi, UAE based airline Etihad for five more years from the Australian competition commission.

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