Australian share market falls 3.3 per cent
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Updated
The passage of a huge financial rescue plan in the US failed to lift the local market. (REUTERS: Daniel Munoz)
The Australian share market today dived to its lowest level since December 2005, as the dollar fell below 75 US cents for the first time in two years.
The ASX 200 dropped as much as 3.6 per cent, but closed down 3.3 per cent at 4,540.
The All Ordinaries index dropped 158 points to 4,545.
Shares on Asian stock markets also fell sharply.
In Japan, the Nikkei fell 4.25 per cent, reaching its lowest closing level since February 2004, while Chinese share prices closed down 5.23 per cent.
The main indexes in South Korea and Taiwan also closed more than 4 per cent down.
On the local market, energy stocks were hit hard after another fall in the price of oil.
Tap Oil and Oil Search were both down more than 8 per cent.
The banks closed in the red with Babcock and Brown noticeably down more than 12 per cent.
About the only stock to close higher in the financial sector was Suncorp-Metway, which confirmed speculation it had received several offers for its banking and investment businesses.
Suncorp shares rose nearly 4 per cent to $11.08.
The former grower-owned fruit company Golden Circle announced it approved a takeover offer from tomato sauce giant, Heinz.
Heinz's $288 million bid beats Coca-Cola Amatil's $212 million offer, which Golden Circle rejected last year.
Heinz is offering shareholders $1.65 a share - a 313 per cent premium on Golden Circle's closing shareprice on Friday of 40 cents.
About 5:00pm AEST, the Australian dollar had dived to its lowest level in two years against the greenback.
It was buying 74.46 US cents, 42.61 UK pence, 77.36 Japanese yen and 55.04 euro cents.
Gold was worth $US830 an ounce.
A barrel of West Texas crude oil was trading at $US93.91.
Rate cut
Financial analyst Peter Switzer said investor sentiment had been hit by the latest round of turmoil in Europe, but it may be boosted by a rate cut tomorrow.
"Well, I'm expecting to see the 0.5 per cent cut," he said.
"I'm expecting to see the Americans cut interest rates before their official meeting and that will be an important test point to see whether the stock market requires a bit of extra help from the central banks.
"I'm hoping that happens and I'm hoping we get a positive result by the end of the week."
Job ads
Meanwhile, the author of the Olivier Job Index, Robert Olivier, said the share market turbulence had led to a 24 per cent fall in jobs advertised on commercial job sites for banking and finance positions.
"A lot of businesses are looking closely at their management teams," he said.
"They're looking at the number of staff at more junior levels and they're seeing what they need and what they don't need, so they're not firing in big numbers but they're reducing the intakes.
"We've even seen the number of graduates' opportunities fall 2 per cent last month, down 16 per cent on the year, so everyone's at risk here."
