Australian Indexes Dive on Weakest Chinese Manufacturing Growth in 6 Years

Marcus Jacob
23 Sep, 2015
New York City

Australian market indexes plunged more than 2% led by another sharp fall in resource sector after the Chinese manufacturing sector growth contracted at the fastest pace since the depth of financial crisis in 2008. Nufarm gained after the agro-chemicals maker reported net annual income increased 15%.

[R]5:30 PM Sydney, Australia – Australian market indexes plunged more than 2% led by another sharp fall in resource sector after the Chinese manufacturing sector growth contracted at the fastest pace since the depth of financial crisis in 2008. Nufarm gained after the agro-chemicals maker reported net annual income increased 15%.[/R]

Australian market indexes plunged more than 2% after another weak data on Chinese manufacturing index sparked a selloff in resource stocks.

Market sentiment was weak at the opening, and the ASX 200 opened lower after a selloff in U.S. and European indexes in overnight trading.

The index decline was accelerated after the latest preliminary survey showed manufacturing sector growth was at its weakest since 2009 since the depth of the financial crisis in 2008.

The preliminary read on the purchasing managers’ index fell to 47, any read below 50 indicates contraction and above 50 shows growth.

Australian dollar closed at 70.36 U.S. cents and in stock trading turnover increased to 773 million shares worth $5.2 billion.

At close, the ASX 200 Index declined 105.50 or 2.1% to 4,998.10 and the broader All Ordinaries Index slumped 98.30 to 5,032.50.

In commodities trading, gold dropped US$8 to US$1,127 an ounce and Brent crude future for immediate month delivery slid 11 cents to US$48.97 a barrel.

Australian Stock Movers

360 Capital Industrial Fund slipped 1.6% to $2.38 after the industrial property developer increased its cash offer to $2.47 per share to acquire the rival Australian Industrial REIT.

The bidding war erupted after the Singapore-based consortium emerged with a cash offer of $2.40 valued at about $230 million.

Industria REIT jumped 2.3% to $2 after the real estate developer agreed to divest its 8.29% stake to 360 Capital Total Return Fund for a total consideration of $20.5 million.

Nufarm Limited soared 9.3% to $7.73 after the crop protection products maker reported revenues in the year ending in July jumped 4% from a year to $2.74 billion.

Net profit in the year surged 35% to $43.22 million compared to $37.71 million and diluted earnings per share jumped to 11.6 cents from 9.6 cents.

New Hope Corporation Ltd closed unchanged at $1.70 after the diversified energy company said revenues in the year ending in July declined 7.9% from a year ago to $505.8 million.

Net in the year swung to a loss of $21.8 million compared to profit of $58.5 million and diluted loss per share swung to 2.6 cents from diluted earnings per share of 7 cents.