Australian market dives to 18-month low

Australian market dives to 18-month low

The Australian share market has hit an 18-month low in early trade.

The benchmark ASX 200 index was down as low as 5,090 - 1.5 per cent lower than the opening value - in reaction to falls in the US and Europe overnight, as well as record oil prices and general fears about slowing economic growth.

The US Dow Jones and London's FT 100 were both more than 1.2 per cent down, and Japan's Nikkei index has also opened down over 0.5 per cent at 12:05 AEDT. (image downloaded from :http://www.abc.net.au/news/stories/2008/03/11/2186124.htm)

Continuing concerns about the stability of some US financial firms, and their exposure to bad subprime debts, have also worried world markets.

The latest target was investment bank Bear Stearns whose shares were attacked on rumours of a cash shortage.

The bank strenously denies the rumours, but this did not stop their share price falling 11 per cent.

Local investment banks have followed that lead lower with Macquarie down 3.5 per cent and Babcock and Brown down 2.7 per cent at 12:25pm AEDT.

The ASX was down 0.9 per cent to 5,135 at 12:30pm AEDT.

Miners suffered the biggest falls with their index more than 3 and a half per cent lower on fears that slowing economic growth would hurt demand for mineral resources. (taken from : http://www.abc.net.au/news/stories/2008/03/11/2186124.htm)