News from AAP

Share market fall steepest in two years

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The Australian share market has suffered its biggest one-day fall in two years after Commonwealth Bank and Woolworths results spooked investors.

The S&P/ASX200 index plummeted by 2.3 per cent on Wednesday, marking the steepest drop since February 2013.

Commonwealth, Australia’s biggest listed company by market value, was the biggest drag on the broader share market, falling to a four-month low.

“The quarterly result did not excite the market – they wanted more in terms of earnings,” Patersons Securities economist Tony Farnham said.

“God only knows what the issue was.”

Commonwealth Bank’s flat $2.2 billion cash profit for March quarter caused its share price to sink by $5.16, or 5.9 per cent, to close at a four-month low of $82.98.

Westpac had lost $1.29, or 3.7 per cent, closing at a seven-month low of $33.99.

ANZ was down 91 cents, or 2.7 per cent, to $33.21 while National Australia Bank shed 97 cents to $35.20, a day ahead of its half year results.

The financial sector was the single biggest drag on the market, losing 3.25 per cent of its value a day after the Reserve Bank cut the cash rate to a new record low of two per cent, without signalling further easing.

Supermarket giant Woolworths had lost $1.49, or five per cent, to $28.14, hitting a two-week low.

The company will cut 400 jobs, and sales growth of just 0.7 per cent, for the quarter ending in April, added to the view that it was underperforming and trailing rival Coles’s owners Wesfarmers.

The miners suffered less severe losses, with BHP Billiton down 21 cents to $32.35, Rio Tinto losing 36 cents to $59.12 but iron ore player Fortescue Metals up 12 cents, or 4.9 per cent, to $2.58.

News Corp fell 79 cents, or 3.9 per cent, to $19.41 after Rupert Murdoch’s newspaper group suffered a seven per cent slide in March quarter earnings, with advertisers deserting it.

KEY FACTS

* At the close on Wednesday, the benchmark S&P/ASX200 index was down 134.3 points, or 2.3 per cent, at 5,692.2.

* The broader All Ordinaries index was down 125.3 points, or 2.15 per cent, at 5,690.9.

* The June share price index futures contract was 144 points lower at 5,690.9 with 38,484 contracts traded.

* The price of gold in Sydney at 1700 AEST was $US1,196.00 per fine ounce, up $US7.85 from $US1,188.15 on Tuesday.

* National turnover was 1.8 billion securities worth $5.9 billion.