Gloomy start worsens after Kim Jong-il's death
BATTLE-WEARY investors were again hit by global headlines, with news of the death of North Korea's dictator Kim Jong-il yesterday shaking investor faith in equities markets.
BATTLE-WEARY investors were again hit by global headlines, with news of the death of North Korea's dictator Kim Jong-il yesterday shaking investor faith in equities markets.Asian markets lost ground, Japan's Nikkei 225 retreating 1.3 per cent and Hong Kong's Hang Seng Index slipping 2.1 per cent.The local bourse was one of the worst performers. The S&P/ASX200 lost 98.8 points, or 2.4 per cent, to 4060.4, and the All Ords lost 104.9 points, or 2.5 per cent, to 4113.9.The Australian dollar lost almost half a US cent, ending on US99.24?, down from US99.70? on Friday."Kim Jong-il's death is the latest spanner in the works. Although a succession plan was already in place, change means uncertainty and uncertainty is not good for markets," Stan Shamu, a strategist at IG Markets, wrote in a note.The week had started gloomily before Kim's death was announced after the business commentator Alan Kohler said he would reduce his "exposure" to equities, fearing a looming panic sell-off on the sharemarket."I don't know when it will happen and it is not a certainty that it will happen ... but I think the risk is now such that you must take action," he wrote in his Week in View."I will be significantly reducing my already reduced exposure to equities, possibly to zero."Woodside Petroleum dragged energy stocks lower after rumours it wanted to delay building a gas processing plant in Western Australia's north. The firm had already delayed making a decision on a $30 billion gas project in the state's Browse Basin so investors pummelled the stock, with shares dropping $1.06, or 3.4 per cent, to $30.24.BHP Billiton fell 87?, or 2.5 per cent, to $34.32, while Rio Tinto fell $1.60, or 2.6 per cent, to $60.20.Billabong shares fell 44 per cent after the company warned its first-half profit could fall by as much as 26 per cent. The surfwear manufacturer said earnings would be between $70 million and $75 million in the six months to December 31, down from $94.6 million on the previous corresponding period. The shares closed at $2.03, down $1.61.The banks all lost ground, with the Commonwealth dwon 84?, or 1.7 per cent, at $48.29, and Westpac 46?, or 2.2 per cent, to $20.05.