Sell-off sees ASX plummet

A HUGE sell-off on the Australian share market took place today on jitters the US Federal Reserve could wind back its stimulus program, with falls compounded by disappointing Chinese manufacturing data.

Lauren Barrett

Australian shares dropped more than 1% soon after the opening bell. And there was no reprieve in sight as risk-averse investors followed in the footsteps of Wall Street’s weak showing.

The S&P/ASX 200 index reversed yesterday’s gains, dropping to an intraday low of 4729 points.

Meanwhile, the release of the latest HSBC purchasing manager’s index indicated China’s manufacturing sector was contracting further.

The index dipped to a nine-month low of 48.3 points in June, down from 49.2 points in May, as output and new orders fell.

At the close, the Australian market fell 2.1%, or 103 points, to 4758.4 and the broader All Ordinaries lost 2% to 4743.9 points.

The Australian dollar fell further against the greenback for a fifth day, last trading at US92.49c.

Among the sectors, telecommunications, technology and utilities lost more than 1% while financials and the miners were the hardest hit, falling 2.6% and 3% respectively.

Gains among the blue chip miners were nowhere in sight, with Rio Tinto dipping 3.3%, or $A1.78, to $52.60 and BHP Billiton sinking 2.5% to $32.15.

Losses were seen across the board, with Iluka Resources dipping 5.1% to $9.96.

Gold miners sank as the price of the precious metal dropped further to $US1344.06 per ounce.

Most iron ore miners were hit following the data out of China.

Gindalbie Metals lost 11.5% to A11.5c and Atlas Iron sank 5.1% to 74c.

Fortescue Metals Group fell 6.5c to $3.14 after reporting a small drop in shipping guidance.

Shares in Reed Resources plummeted 24.5% to 3.7c on the back of an update regarding its Meekatharra gold operation.

Reed indicated the Bluebird pit mined 20,500 ounces of gold to May, down from its capacity of 22,600oz.