jwaeda | ABC via PNG Loop
The resources sector is being hit by a significant sell-off, after iron ore prices tumbled overnight and oil fell.
Overall, the ASX 200 index was off a moderate 0.5 per cent at 5,294 by 10:40am (AEST), with some other sectors helping to offset the worst of the resources decline.
However, mining firms were being pummelled, with BHP Billiton down 4.2 per cent, Rio Tinto off 4 per cent and Fortescue and South32 both slumping 6.25 per cent.
Those declines were triggered by a wave of commodity selling overnight, largely in reaction to Chinese trade figures over the weekend that showed a surprisingly large slump in imports, casting doubt on the health of that nation’s domestic economy.
The benchmark Tianjin iron ore spot price dropped to $US55.60 in China yesterday, and the Dalian futures price for September is down more than 4 per cent today and has fallen for six sessions in a row.
Oil prices also fell overnight, as Canadian fires moved away from key processing facilities.
The key Brent futures price was back down to $US43.44 a barrel.
Australia’s oil and gas producers followed, with Woodside off 3 per cent to $26.52, Oil Search and Origin also down around 3 per cent and Santos off around 4 per cent.
Outside the resources sector, most falls were more moderate.
ANZ was down 0.6 per cent, while its big four rivals were between 0.2 and 0.4 per cent higher.
Qantas jumped 2.7 per cent to $3.42 on the prospect of oil prices continuing to reverse their upward trend of the past couple of months.
The big supermarkets also fared well, with Woolworths up 0.5 per cent and Wesfarmers 0.25 per cent.
The Australian dollar was again weaker on the commodity price decline, fetching 73.05 US cents.