The Australian share market closed down by just over four cent to a near five-year low as bank and resource stocks were weighted down by continuing concern about the health of the global economy.
At the 1615 AEDT close, the benchmark S&P/ASX200 index was down 144.1 points, or 4.13 per cent, at 3,3342.7 – its lowest close since February 2004 when the index finished at 3,333.7.
The broader All Ordinaries index fell 131.6 points, or 3.83 per cent, to 3,300.3 – its lowest close since late January 2004 when the index closed at 3283.6.
On the Sydney Futures Exchange, the March share price index futures contract was 141 points lower at 3,353 on a volume of 14,180 contracts, according to preliminary calculations.
Overseas banks affecting Australia
Analysts said continuing unease over the health of overseas banks weighed on local banks and the resources sector was hit heavily by concerns over the slowdown in Australia\’s major export partners – Japan, China and South Korea as well as lower base metal prices.
CMC Markets analyst David Taylor said local trading started poorly on Friday following a negative lead from United States markets and more bad news on the US economy.
“Again, the economic numbers out of the US last night – housing figures and jobless figures – were all disappointing,” Mr Taylor said.
“We\’ve got more bad news out of their banking sector. The banks were sold off last night, and that\’s flowed on to our market.
“Base metals prices were down.
Everything that could be down, down\’
“Just about everything that could have been down was down, in terms of what effects our market.”
Mr Taylor said disappointing news from investment firm Babcock & Brown may also have added to the general pessimism in the local financial sector.
In the resources sector, global miner BHP Billiton fell $1.69, or 5.8 per cent, to $27.45 while rival Rio Tinto dumped 74 cents to $38.06.
Oil and gas producer Santos was off 60 cents to $13.40 as it said it would either match or fall short of last year\’s total production, in 2009.
WAmong the major banks, Commonwealth Bank of Australia was $1.53, or 5.98 per cent, lower at $24.07 as the bank suffered an acceleration of outflows in its funds under management during the December quarter.
On Wall Street overnight, the Dow Jones Industrial Average index feel 105.3 points, or 1.28 per cent, to 8,122.8.