Sydney, Oct 9, 2008 AEST (ABN Newswire) - Wall Street lost 2% overnight, failing to find some stability from the rate cut by the Federal Reserve and other big central banks.

Yesterday, the Australian share market closed at a fresh three-year low, plummeting 5% as the continuing fallout from the global credit crisis wiped A$56 billion from the value of stocks. The benchmark S&P/ASX-200 share index lost 5% yesterday, the biggest one-day fall for both major stock exchange indices since January 22 this year. RBA has said the Australian economy is slowing faster than originally anticipated. Analysts said the sell-off is totally unemotional. Markets across Asia also slumped with 5-10% drop in Tokyo, Hong Kong, Singapore, Mumbai and Jakarta.

Yesterday the benchmark S&P/ASX200 index was 230.6 points, or 5%, lower at 4388.1, while the broader All Ordinaries lost 228.1 points, or 5%, to 4369.8. At 0807 AEDT, the December Share Price Index futures contract on the Sydney Futures Exchange was down 12 points at 4,336.

Today the Australian dollar has opened lower for the 12th consecutive local session after dropping to a five-year low of $US0.6454 overnight as the bleak global economic outlook caused investors to abandon the high-yielding currency. At 0700 AEDT, the Australian dollar was trading at $US0.6715/21, down a little over one US cent from Wednesday's close of $US0.6832/36.

Crude oil fell to the lowest in 10 months as the US government reported a bigger-than-expected gain in crude and gasoline inventories as the global economic crisis curbed demand. New York's main contract, light sweet crude for delivery in November, fell $US1.11 to close at $US88.95 a barrel.

Key Economic Facts and Figures

The Australian Bureau of Statistics (ABS) said the number of new home loans in August slumped to a seven-year low, and further interest rate cuts are no guarantee to boost the moribund housing sector any time soon. Approvals for owner occupier home loans slipped 2.2 per cent during August to 48,903. It was the seventh consecutive monthly fall and the lowest number for home loan commitments since March 2001.

The Westpac-Melbourne Institute consumer sentiment index dived by 11 per cent to 82 points in October, an unusually large fall comparable with the 1987 stock market crash and the tech wreck of early 2001.

Today the Melbourne Institute Survey of Consumer Inflationary Expectations for October and the Australia Bureau of Statistics labour force data for September will be released.

M&A News
After the Commonwealth Bank(ASX:CBA) had announced the acquisition of BankWest from HBOS(LSE:HBOS), the bank was still in the field to buy Suncorp-Metway(ASX: SUN )too. ANZ(ASX:ANZ) and NAB(ASX:NAB) are also contenders. Analyst estimates of prices for the takeover have ranged between A$6billion and A$8 billion.

Westfield Group(ASX: WDC) raised significant funding prior to the credit crisis and is thus in a strong position. Its potential takeover target General Growth(NYSE:GGP) plunged 42 percent in New York trading two days ago. Potential targets for a Westfield takeover also include the owner of Hawaii's Ala Moana Centre and Liberty International.

Important Corporate News

Stockland(ASX:SGP) says that the property group has raised A$300 million from a placement to institutional investors and will use the money on development in Australia rather than the United Kingdom. The company has maintained its guidance for a 7 per cent dip in operating earnings for fiscal 2009.

Lend Lease(ASX:LLC) said Mr Ross Taylor and the board had disagreed on future directions for the company. As a result, Taylor has agreed to step down and resign from the company's board immediately. Taylor took on the role of Lend Lease COO in 2007.
Nexus Energy(ASX:NXS) insisted last night it remained on track to produce first light crude from its Crux project by 2011, despite failing to secure Japanese trading house Mitsui as a venture partner. The failed deal leaves Nexus with an 85 per cent stake in Crux. Osaka Gas(TYO:9532) has the remaining 15 per cent.

Northern Energy(ASX:NEC) has released its end of financial year accounts and has reported a net loss of A$0.9 million, A$0.4m more than its loss of A$0.5m in the 2006-07 financial years.

Bank of Queensland (ASX:BOQ) has reported a net profit of A$126.8 million for the year to August 31 2008, compared with A$129.8m in FY07. Normalised cash net profit after tax was A$155.4m against A$106.1m.

Contact

Michelle Liang
Asia Business News Aisa Bureau
Tel: +61-2-9247-4344
Email: michelle.Liang@abnnewswire.net


Related Companies

Westfield Group        
Suncorp Group Limited         
Stockland        
Osaka Gas Co., Ltd        
Nine Entertainment Co. Holdings Limited           
Nexus Energy Limited        
National Australia Bank Limited         
Lendlease Group          
HBOS Plc     
General Growth Properties, Inc     
Commonwealth Bank of Australia        
Bank of Queensland Limited        
Australia and New Zealand Banking Corporation        

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