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Market closes down after overseas jitters

THE sharemarket closed sharply lower, shedding about $35 billion in value, with fewer buyers in the market on a public holiday in New South Wales.

THE sharemarket closed sharply lower, shedding about $35 billion in value, with fewer buyers in the market on a public holiday in New South Wales.

Shares opened about 1.5 per cent lower after brutal selloffs in European and US markets on Friday.

By the close yesterday, the local market had extended early losses, with the benchmark S&P/ASX 200 Index down 111.6 points, or 2.8 per cent.

Patersons Securities associate director Mark Goulopoulos said the market's performance and trading volumes had been hit by a "low liquidity market" yesterday, which was a public holiday in NSW.

Turnover was 1.14 billion shares worth $2.92 billion, less than half the usual value, with nine of every 10 stocks falling.

"There's not been a situation of panic selling . . . if there [has been] any selling in the market there's not been a lot of buying interest on the other side."

The market closed ahead of the release of the US Institute of Supply Management (ISM) manufacturing survey, which could be a key turning point for local shares when they returned to normal trading today, he said.

IG Markets analyst Cameron Peacock said investors were trading off speculation about the euro zone debt crisis, and ongoing fears that China's economic growth was slowing, which could hurt demand for local resources.

"Some of these industrial metals are getting hammered on talk and speculation that demand out of China is slowing and that's why we're seeing the materials and energy names being [some of the] hardest hit today."

Financials and materials were the weakest performers, with both ending 3.2 per cent lower. ANZ fell 2.9 per cent to $18.94 as Australia's largest class action over its bank fees was set to go back to court on Monday. Mining giant BHP Billiton fell 2.5 per cent to $34.15, while fellow miner Rio Tinto shed 4.1 per cent to $59.30.

Energy stocks fell after oil prices declined on Friday, Woodside Petroleum shedding 2.7 per cent to $31.62, and Santos down 2.6 per cent at $11.08.

The weakest stock of the top 100 companies on the ASX was Aquarius Platinum, which plunged 11 per cent to $2.64.

All sectors lost ground except typically defensive health stocks, which rose 0.16 per cent, led by CSL, which was the strongest stock on the ASX 100, and one of only six companies on the index to add value, rising 1.2 per cent to $30.03.

Elders lost 5.2 per cent to 27.5 cents after it started offloading its struggling forestry business.


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