Flood of tears
Published in the Herald Sun, July 2008
Almost $40 billion in value was wiped from the Australian stock market yesterday in its biggest one day fall in six months.
Investor sentiment, already bruised by a sharp fall on Wall Street the previous night, was shattered by the National Australia Bank's surprise disclosure on its US mortgage backed securities woes.
Investors took a knife to banking stocks and weaker commodity prices meant big resources stocks did not escape unscathed.
A huge wave of selling occurred as soon as the market opened, with a hefty $35 billion in value soon wiped out.
Analysts warned that further tremors across global share markets were coming and would inflict more pain on local investors.
"The fear is there's a lot more bad news to come," said Nader Naeimi, senior investment strategist at AMP
Wealth Within chief analyst Dale Gillham said Australia's market was in for a rough ride in the short to medium term.
"It is still possible it could fall away to trade around 4300 points, which is the next support level on the All Ordinaries Index," he said.
The Australian dollar also took a hit yesterday, dropping as low as US95.400 - its weakest since July 10 - before trading at US96.010 early last night.
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