US woes pull Aust shares down

The Australian sharemarket has opened lower, led down by miners, as local investors follow a weak lead from Wall Street on ongoing concerns about a recovery in the US economy.

In early trade, the benchmark S&P/ASX200 index was 36.4 points lower, or 0.8 per cent, at 4416.3 points, while the broader All Ordinaries index fell 34.7 points, or 0.8 per cent, to 4448.4 points.

Markets have become hyper-sensitive to economic developments, said CMC Markets analyst David Taylor.

"It comes as no surprise because that's at the core of the problem," Mr Taylor said.

"Equity markets around the world, to varying degrees, are impacted by US economic growth. Last night we received data indicating the US consumer is running out of money, and that manufacturing activity (Dallas) was noticeably weaker."

The major miners led the local market down. BHP Billiton was 66 cents lower, or 1.7 per cent, at A$37.21, while Rio Tinto fell A$1.07, or 1.5 per cent, to A$69.94.

Mr Taylor said he expected on-market selling to dwindle by midday.

''I think most of the selling will be exhausted by 11.30/12.00 today,'' he said.

''We will probably plateau after that.''

The major banks followed the weak lead.

Westpac was the weakest performer, its shares down 30 cents, or 1.3 per cent, at A$22.03. ANZ was down 19 cents at A$22.76, Commonwealth Bank was 15 cents lower at A$50.40, and National Australia Bank fell 16 cents to A$23.39.

Gold miner Newcrest Mining was up 55 cents at A$36.56, as Lihir Gold has ceased trading after being taken over by Newcrest.

The energy sector was weaker, with Santos 12 cents lower at A$14.31, while Woodside Petroleum was down 17 cents at A$42.28.

In company news on Tuesday, Southern Cross Media Group Ltd has recorded an A$82.7 million annual loss and says it is cautiously optimistic about the current financial year.

Shares in the media company were up one cent at A$1.78.

Fellow media companies were weaker, with News Corp down 10 cents at A$15.65 and its non-voting stock down two cents at A$13.87.

Fairfax Media was one cent lower at A$1.435.

The highest turnover stock by volume at 10.53am AEST (12.53pm NZT) was Isoft Group, with 24.61 million shares changing hands at a total value of A$3.39 million.

Shares in the electronic health care provider were down 3.5 cents, or 21.2 per cent, at 13 cents, after the company announced 1,188 per cent drop in its net result.

Isoft announced a net loss of A$381.87 million in the year to June 30, down from a profit of A$35.09 million in the prior year.

National turnover at 10.55am AEST was 403.62 million shares worth A$916.9 million, with 424 stocks down, 235 up and 303 were unchanged.

- with AAP

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