The Australian share market has closed lower, led by sharp losses among the big miners.
Market heavyweights BHP Billiton and Rio Tinto both slumped more than four per cent on the back of weaker prices for commodities.
“We’ve just seen another significant decline in commodity prices in the Asian time zone,” CMC Markets chief market analyst Ric Spooner said.
“So, in market terms, we’ve got a bit of a capitulation going on, I suppose.”
Mr Spooner said prices for some commodities, such as copper and oil, may be falling because markets expected that supply would outstrip demand, if by only a little.
Supply capacity had been improved but demand was moderating on concerns about the strength of economic growth in China and a patchy economic recovery in the United States.
“With commodity markets you only need to go from a situation where there’s a bit of a supply deficit to a bit of a supply surplus to have quite a significant impact on prices,” Mr Spooner said.
BHP Billiton fell $1.41, or 4.4 per cent, to $30.65 as it announced changes to its management team, including the departure of Mike Yeager as head of its petroleum division.
Rio Tinto dumped $2.52, or 4.62 per cent, to $52.07.
Fortescue Metals fell 29 cents, or 7.8 per cent, to $3.43 as it said it was confident of meeting its full year production targets.
Mineral sands miner Iluka Resources shed 58 cents to $8.71 as it said it was planning further production cuts because of weak demand.
Oil and gas producer Woodside Petroleum reversed $1.22 to $33.86 as it said it was confident of meeting its full year targets.
Gold miner Newcrest lost $1.21, or 7.08 per cent, to $15.89.
Among other stocks, Wesfarmers was up 33 cents at $42.22 after it said total sales at its Coles supermarkets rose 6.4 per cent in the third quarter.
Telstra eased three cents to $4.79 despite winning a $1.1 billion contract with the Department of Defence in a deal that will lead to 350 new jobs being created at Australia’s largest telco.
KEY FACTS
*On Thursday, the benchmark S&P/ASX200 index was down 80.2 points, or 1.6 per cent, at 4,924.4 points.
* The broader All Ordinaries index was down 82.3 points, or 1.65 per cent, at 4,911.3 points.
* The June share price index futures contract was down 70 points at 4,932 points, with 32,827 contracts traded.
* The price of gold in Sydney was $US1,376.85 per fine ounce, down $US2.35 on Wednesday’s closing price of $US1,379.20.
* National turnover was 1.9 billion securities worth $5.99 billion.
