Double dip fears cost market $60b
THE sharemarket slumped 4 per cent to its biggest one-day loss since the height of the global financial crisis almost three years ago.
THE sharemarket slumped 4 per cent to its biggest one-day loss since the height of the global financial crisis almost three years ago.Fresh concerns that the US could be heading back into recession and fears that Europe's debt woes could be spreading to Italy and Spain sent investors to the exits. The fall wiped almost $60 billion from the value of Australian stocks yesterday and took the cumulative loss to about $100 billion for the past week.Local traders followed the overnight lead of the US, where the Dow Jones Industrial Average sank 4.3 per cent, or 512 points, to its worst one-day drop in more than two years.Australian stocks closed at their lowest level since July 2009. It was the biggest one-day percentage fall since November 20, 2008.The benchmark S&P/ASX200 index slumped 171.1 points, or 4.0 per cent, to 4105.4, while the broader All Ordinaries index was 183.2 points, or 4.21 per cent, weaker at 4169.7.Every sector was down and the resources boom was forgotten, with the mining and energy sectors off by more than 5 per cent.IG Markets strategist Cameron Peacock described the drop as a "bloodbath" caused by anxiety about the European debt crisis spreading to Italy and Spain then colliding with the US's debt woes. "It all came to a bit of a head, that's why we're seeing this global rout at the moment" Mr Peacock said.Mining giant Rio Tinto lost $4.58, or 5.98 per cent, to hit $72, just a day after posting a record $7.3 billion half-year underlying net profit. BHP Billiton closed down $1.94, or 4.84 per cent, at $38.12. Gold miner Newcrest was down $1.45, or 3.57 per cent, at $39.20.Among energy stocks, Woodside Petroleum plummeted $1.95, or 5.34 per cent, to $34.55. Santos fell 82?, or 6.65 per cent, to $11.52 and Origin Energy dropped 43?, or 3.05 per cent, to $13.66.ALL ORDS AUSTRALIA AUG 44169.7183.20(-4.2%)HIGH 4352.9LOW 4150.7SOURCE: BLOOMBERG