A drop of about 10 per cent in the spot price of coal in the US, Europe and Australia was the catalyst for many sales and sent shares of Centennial Coal tumbling 14 per cent and Macarthur Coal down 7.7 per cent.
MORE than $25 billion was wiped from Australian resources stocks yesterday as falling coal prices and concerns that record oil prices would begin to weigh on global growth started a rush for the exits.
"The big catalyst for declining resources was that over-the-counter coal price fell in a heap, sending most US coal stocks down," Macquarie Private Wealth associate director David Halliday said.
"You’ve seen falls in base metals and now in coal. It gets people thinking all these bubbles burst at some point."
The S&P/ASX 200 materials index, largely made up of miners but including steel makers and chemical makers, finished the day down 6.1 per cent, losing more than $20 billion in value, and the energy index lost about $5 billion.