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Australian Market Trades Weak

The Australian stock market opened sharply lower Tuesday with investors going on a selling spree across the board, amid worries about instability in the eurozone following former Prime Minister Silvio Berlusconi's staying slightly ahead in the Italian elections.

Consumer staples, mining, financial and energy stocks are mostly trading lower. The benchmark S&P/ASX 200 index, which plunged to 4,978.4 in early trades, is currently down 39.1 points or 0.8 percent at 5,016.7. The broader All Ordinaries index is down 37.1 points or 0.8 percent at 5,035.6, well off an early low of 4,997.5.

Atlas Iron is trading lower by 3.7 percent following the company posting a first-half loss of A$256 million. The loss includes A$455 million in charges related to impairments on Atlas' undeveloped Horizon 1 and 2 project areas and other tenements. The NSW-focused miner's result in the six months to December 31 was down from an A$19.9 million profit in the previous corresponding period.

Sims Metal Management is down 3.5 percent. Flight Centre is trading lower by 3.4 percent.

QBE Insurance Group shares are trading lower by 3.3 percent following the company reporting a rise of 8 percent in annual profit, lower than previously forecast due to severe droughts and storms in the United States.

Harvey Norman Holdings, Boral, ALS, Caltex Australia, Suncorp Group and Fortescue Metals are trading lower by 2.5 to 3 percent. Lynas Corp., Incitec Pivot, Myer Holdings, Amcor, Alumina (AWC) and Origin Energy are down 2 to 2.2 percent.

Seven Group Holdings shares lost more than a percent, despite the company reporting a 20 percent surge in full year profit.

Virgin Australia declined by over 2 percent following a sharp 56 percent decline in first half profit.

Meanwhile, Perseus Mining, Newcrest Mining, Monadelphous Group and Commonwealth Property Office Fund are trading in positive territory, gaining 2 to 3 percent.

In the currency market, the Australian dollar edged higher against the U.S. dollar. In early trades, the local unit was quoting at US$1.0289, up marginally from Monday's close of US$1.0279.

Among other markets in the Asia-Pacific region, Hong Kong, Japan, Taiwan, South Korea and Singapore are trading notably lower, while Malaysia and New Zealand are down with modest losses.

On Wall Street, stocks declined sharply on Monday amid concerns about the eurozone economy. Uncertainty about whether lawmakers in Washington will be able to reach an agreement to avoid the automatic government spending cuts due to go into effect at the end of the month also weighed on the markets.

The major averages ended the sessions at their worst levels of the day. The Dow plunged 216.4 points or 1.6 percent to 13,784.2, the Nasdaq tumbled 45.6 points or 1.4 percent to 3,116.3 and the S&P 500 plummeted 27.8 points or 1.8 percent to 1,587.8.

Major European markets closed higher on Monday. While the German DAX index jumped 1.5 percent, the French CAC 40 index and the U.K.'s FTSE 100 index gained 0.4 percent and 0.3 percent, respectively.

U.S. crude oil ended a tad lower on Monday, mostly on demand concerns after some soft macroeconomic data out of China suggested a slowdown in manufacturing sector growth. Crude for April delivery dropped $0.02 or 0.02 percent to close at $93.11 a barrel on the New York Mercantile Exchange.

by RTTNews Staff Writer

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