Sydney, Nov 2, 2007 (ABN Newswire) -
The share market fell heavily in morning trade. Investors became nervous after learning news of analyst's downgrades of the two largest U.S. banks in the wake of the recent global credit squeeze. A pull-back in oil and metals prices also weighed on resource firms.
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http://abnnewswire.net/lnk/2DJAJ4O1At Midday the S&P/ASX200 index has dived 139 points to 6,690 and on the futures market the SPI 200's down 135 points.
In company news this hour, Telecom New Zealand's first quarter profit has come in ahead of expectations. Earnings came in at NZ$225 million, up from an expected $188 million. The better-that-expected earnings came after a tax charge fell by a third. The company however warned of a weaker full year profit due to rising costs and increased competition. Meanwhile chief executive Paul Reynolds has ended speculation about a possible sale of the telco's phone network, telling Reuters he was not interested in selling. Telecom New Zealand shares last traded 2.27% lower at $3.45.
And Downer EDI has cut its earnings forecast for 2008. The engineering firm says costs at its mining operations will result in flat earnings before interest and tax this year. In a recent report, chief executive Brent Waldron says the company expects EBIT of around $280 million?in line with last year. The company is also in the process of looking for a new chief to replace Stephen Gillies. Mr Waldron has been named as a candidate. Downer EDI shares last traded 10.69% lower at $5.93.
Turning now to market indices, all the major indices were down this morning. Among the indices posting the least amount of losses by percentage points is the Utilities index shedding 17 points to 7004. Shares in EnviroMission surged 20% to 12 cents. AGL Energy and Spark Infrastructure shares are also higher.
The index posting the most significant loss by percentage points is the Materials index, down 512 points to 15,637. Aquarius Platinum is down 4.92% to $40.21. Rio Tinto and BHP Billiton shares have also lost ground.
In Tokyo, the Nikkei is down 339 and in New Zealand the NZSX50 has lost 42 points.
Gold is currently trading at $791.90 U.S an ounce and one Australian dollar's buying 91.66 U.S cents.
Source: Finance News Network © 2007
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