Resources lead slide in big names

Banks fared better, with losses contained to about 5 per cent for the week, while Telstra - one of the more defensive stocks - was one of the few to outperform - it fell only about 2 per cent.

Overall, the S&P/ASX 200 fell 5.7 per cent over the week.

"It's the resources sector that is really dragging us down," Michael Heffernan, a senior client adviser and economist at Lonsec sharebrokers, said. "It is not just the miners, but the mining services stocks that have been knocked around," he said.

Telstra, with its dividend yield of 8 per cent, fully franked, is a "fantastic" stock, Mr Heffernan said. "It's an environment where income and cash is king."

Other defensive stocks that performed relatively well included AGL Energy, Sonic Healthcare, Ramsay Health Care and Woolworths.

"There was already weak economic data coming from China and then with what is happening in Europe, everyone starts factoring in the worst case scenario", the research director Intelligent Investor, Nathan Bell, said. "We remain cautious on resources," he said. "Share prices have come down but there is more room for things to get worse in the sector."

He is also cautious on banks because they are largely a "play on mortgages" and mortgage volumes are down. "However, they remain very profitable and it looks as if the Commonwealth Bank may be the first bank to post a $7 billion annual profit in August."

WEEK OF WOE

Fortescue $4.66 -14.34%

Leighton $16.8 -10.88%

Rio $55.2 -9.95%

BHP $31.46 -8.55%

Woodside $30.99 -7.90%

AMP $3.88 -6.73%

Westpac $20.41 -6.55%

ANZ $20.84 -5.83%

NAB $23.32 -5.59%

CBA $49.4 -4.98%

Source: Intelligent Investor