AFTERNOON REPORT
(12pm AEST)

The Australian share market has fallen to its lowest level since July 2009 in early trade. Overnight European share markets slumped to 11 month lows on continued worries about European sovereign debt, while US stocks recorded their biggest one day decline in two and a half years. At lunchtime in the East, the All Ordinaries Index (XAO) is down 187.8pts or 4.3pct to 4165.1.

The financial sector is down 3.9pct with shares in Macquarie Bank (MQG) off 8.1pct to $23.02. The ANZ (ANZ) is weakest out of the big four, down 4.5pct to $18.90.

The energy sector has fallen by 5.4pct after the price of crude oil eased by 5.8pct overnight to US$86.63 a barrel.

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Among the mining players, BHP Billiton (BHP) is down 3.8pct to $38.51 while Rio Tinto (RIO) has shed 5pct to $72.65 and Fortescue Metals Group (FMG) is lower by 6.2pct to $5.75.

Retail stocks are also being battered. Shares in David Jones (DJS) are lower by 6.4pct to $2.77 while Myer Limited (MYR) is off 6.6pct to $2.12.

Defensive stocks are failing to rally, with Telstra (TLS) lower by 3pct to $2.87.

Across the Asian region, the sell-off is just as dire. Japan's Nikkei index has fallen 3.6pct in early trade while the Taiwan Composite is off 5.2pct and China's share market has lost 2pct.

The Australian dollar is buying US104.84c, £0.6448 and €74.32c.

(From Juliette Saly, CommSec Market Analyst)

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