The Australian sharemarket closed moderately lower today but was well off early lows as Centro Properties remained under the hammer.
Australian stocks declined, pushing the S&P/ASX 200 Index to its biggest two-day loss since the Sept. 11 terror attacks six years ago. .Westfield Group and St. George Bank Ltd. led declines as concern mounted the U.S. housing slump and credit crisis will stall growth in the world's largest economy.
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Centro Properties Group, which owns 700 shopping malls in the U.S., plunged for a second day after saying it's struggling to refinance debt because of the collapse in the subprime mortgage market. BHP Billiton Ltd. and Woodside Petroleum Ltd. fell after metal and oil prices dropped on speculation a slowdown in the U.S. will curb demand for commodities.
``We're looking at a rocky and volatile period and the market has come back savagely,'' said Paul Xiradis, who helps manage about $11 billion at Ausbil Dexia in Sydney. ``There are serious question marks about the strength of the U.S. economy and the debt market is not fully functioning at this point.''
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The ASX200 index - which plunged 228 points yesterday - closed 26.6 points lower at 6236.9 after being down 158 points at one stage, while the All Ordinaries index lost 39.2 points to 6292.6.
In futures the December SPI200 index fell 83 points to 6207.
Trading was busy with turnover of $7.6 billion, comprising 361 rises, 1,038 falls and 331 steadies.
BHP Billiton was the day's busiest stock by value with turnover of $681 million, and shed 27c to $40.10.
Rio Tinto lost $2.44 to $129.41, Zinifex slumped 69c to $12.40 and Alumina was unchanged at $6.05.
Centro Properties, which plunged $4.34 yesterday, slumped a further 55.5c to 80.5c and plumbed 42c in continued reaction to its warning on refinancing problems and the cancellation of the first-half distribution.
Banks were mostly firmer after early losses, although National missed out with a fall of 59c to $36.91.
ANZ gained 29c to $27.24 and Westpac ended 50c higher at $28.80 while Commonwealth was steady at $60.
When trading opened this morning, Centro went into a spectacular free-fall as expected, bruising other property companies in its wake.
CommSec chief economist Craig James, like most market watchers, witnessed the almost deadly dive.
"Certainly, if you've got any money invested in the property trust sector, you'd be feeling a little bit sick at the moment," Mr James said.
'Property trusts [are] down the order of 4 per cent, [with] significant falls right across the board. There's only a few areas of joy in the sector."
Within a few minutes, the company was down 38 per cent on yesterday's close, before the losses extended to more than 67 per cent.
Even after settling down at a 50 per cent loss, Centro's devastation has left many wide-eyed.
Macquarie Group dropped $2.82 to $73.28, AMP lost 10c to $9.90, IAG rose 7c to $4.20, Westfield Group climbed 72c to $20.29, Stockland jumped 25c to $8.75, Lend Lease declined 58c to $17.32, Mirvac was down 16c at $5.75, Bluescope Steel fell 36c to $8.90, Sims Group improved 35c to $27.35, Computershare dropped 45c to $9.50, Cons Media slid 23c to $4.37, Fairfax Media fell 5c to $4.56, Telstra was 5c firmer at $4.67, Flight Centre gave back 42c to $30.28, Wesfarmers gained 56c to $40.74, Leighton was $1.96 weaker at $59.04, Woolworths fell 45c to $33.90, Foster's advanced 16c to $6.37 and Cochlear declined 37c to $72.55.
Woodside Petroleum climbed out of the red to end 35c higher at $47.30 and Santos put on 4c to $13.59 while Caltex fell 50c to $19.20.
Newcrest slumped $1.29 to $30.38 among the goldminers, Lihir slipped 4c to $3.18 and Newmont shed 6c to $5.40.
In Tokyo the Nikkei 225 was down 70 points at 15,180 with about 30 minutes of trading left and Hong Kong's Hang Seng had risen 114 points to 26,710 by the mid-session interval.
New Zealand's NZX 50 index fell 36.5 points to 3926.1.
Gold is worth $US791.70 an ounce and the Australian dollar is changing hands at US85.94c.
Ten-year bond yields were two points lower at 6.275 per cent.
Australia's S&P/ASX 200 Index plunged the most in four months on concerns higher U.S. inflation will curb spending in the world's biggest economy. Centro Properties Group tumbled, wiping out three-quarters of its value, after slashing its profit forecast due to the U.S. housing slump.
Westfield Group, owner of 59 malls in the U.S., declined after consumer prices there climbed the most since September 2005 last month, giving the Federal Reserve less leeway to cut interest rates to boost growth. BHP Billiton Ltd., the world's biggest mining company, dropped on concern a global economic slowdown will curb demand for metals and other raw materials.
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