Fri, Jul 25 02:08 PM
SYDNEY, Australia (AP) _ Australia's main stock index recorded its largest one-day fall in six months on Friday after one of the country's biggest banks announced additional losses linked to the global credit crunch. The benchmark S&P/ASX200 index fell 173.6 points, or 3.37 percent, to close at 4,970.5 after hitting a low of 4,939.8 in intraday trade.
The broader All Ordinaries fell 157.4 points, or 3.03 per cent, to 5,031 after reaching a low of 5,003.2 in early trade. It was the biggest one-day fall since Jan.
22, when the S&P ASX 200 fell 7.1 percent and All Ordinaries fell 7.3 percent. Worrying news from National Australia Bank, the country's second largest lender by market capitalization, combined with overnight losses on Wall Street triggered the sell-off, traders said.
NAB announced an A$830 million (US$825 million) loss on its exposure to complex U.S. mortgage-backed debt securities, adding to a A$181 million (US$174 million) write-down the bank had previously announced. "The NAB news coupled with the fact that the U.S. market was off nearly 300 points has absolutely smashed the local market," said James Foulsham, senior dealer at CMC Markets.
The NAB announcement sent rival bank stocks plunging as well. NAB sank almost 13.5 percent to A$26.56.
Commonwealth Bank of Australia was almost 7 percent lower at A$43.25, and Westpac Banking Corp. lost more than 3 percent to close at A$22.09.
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