Oil slump hits market

Price fall weighs on Aussie shares

THE Australian share market closed lower after weaker oil prices weighed heavily on the energy giants and mining giant BHP Billiton.

The benchmark S&P/ ASX200 index was down 0.48 per cent to 6004 points, while the broader All Ordinaries fell 0.45 per cent to 6113.6 points. Global oil prices fell between three and four per cent on Friday following news that Saudi Arabia and Russia have discussed reducing their production cuts.

Bell Direct equities analyst Julia Lee said the lower oil prices not only weighed on energy companies but also mining giant BHP Billiton which has a big exposure to oil and gas.

“Iron ore prices have also fallen and that’s also weighing on the miners,” Ms Lee said.

“The banks were trading lower especially after Commonwealth Bank hit a multiyear low on Thursday.”

Energy giant Woodside Petroleum dropped $1.16, or 3.5 per cent, to $31.70, Santos de- clined 21 cents, or 3.5 per cent, to $5.68, Oil Search shed 18 cents, or 2.2 per cent, to $8.03, while Beach Energy tumbled 16.5 cents, or 9.6 per cent, to $1.555.

BHP lost 96 cents, or 2.9 per cent to $32.11, Fortescue Metals shed four cents, or 0.9 per cent, to $4.50, while Rio Tinto was five cents, or 0.1 per cent, lower at $83.12.

All four major banks were down ranging from Westpac’s 0.07 per cent dip to ANZ’s 0.5 per cent drop.

Telstra’s shares were hit with another wave of selling after Standard and Poor’s Global Ratings downgraded the telco’s credit ratings due to intense competition across its core businesses.

Shares in Telstra were down three cents, or 1.1 per cent, to $2.84. Among the worst performers was supermarkets supplier Metcash which fell 65 cents, or 17.7 per cent, to $3.03 after it warned of a potential $270 million sales hit as one of its customers shunned its new South Australian distribution centre.

Billboard and advertising group APN Outdoor was among the best performers after it upgraded its revenue outlook and forecast full-year underlying earnings to be in the range of $92 million to $96 million, up from $90.3 million in the prior year.

Shares in APN Outdoor jumped 39 cents, or 7.7 per cent, to $5.48.

Meanwhile, the Australian dollar was slightly higher against the US dollar, after strengthening against the greenback last week.