Australian markets dive

The Australian share market improved slightly by noon but remained sharply lower, with heavy losses in all sectors.

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At 1200 AEST, the benchmark S&P/ASX200 index was down 75.6 points, or 1.74 per cent, at 4,270.1 points, while the broader All Ordinaries index was down 76.7 points, or 1.75 per cent, at 4,293.8 points.

On the Sydney Futures Exchange, the September futures contract was down 81 points at 4,257, on volume of 16,875 contracts.

Wall Street and European markets suffered heavy falls overnight as US consumer confidence fell for the first time in four months.

That data added to the negative impact of a downward revision of China’s economic activity.

Bell Financial Group senior adviser Chris Kimber said that while the figures from China were lower than expected, that economy remained strong.

“We had the double whammy with the sell off in the US last night, slightly slower Chinese growth numbers than we expected but we still think those numbers are very good,” Mr Kimber said.

Growth in China may slow from 13 or 14 per cent growth to nine per cent, which is still “pretty fantastic”, he said.

“Markets are still very sensitive. The last day of the financial year is giving it a bit of a belting.

“With the mining stocks, we’re still hoping that the government and the new prime minister will come up with a workable tax proposal in the short term which hopefully will provide better sentiment for that sector, as well.”

Mr Kimber said he expected the market would close firmer than its noon reading.

Rio Tinto shares were down $2.16, or 3.16 per cent, at $66.26, and BHP Billiton lost 88 cents, or 2.31 per cent, to $37.22.

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