Bad news spooks ASX investors

ASX falls, but these three stocks fared worse

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published September 20, 2012 5:54 pm AEST

The S&P / ASX 200 Index (index: ^AXJO) ( ASX: AXJO) fell today by 21.2 points, or 0.5% to close at 4,397.2.

Weighing on the index was HSBC's Flash China manufacturing purchasing managers index (PMI) showed China's growth is still slowing although the pace is stabilising.

Investors didn't appear to like the numbers much, and resources companies were hit across the board.

Last week Saudi Arabia said they'd look to increase production of oil to calm rising oil prices, saying they were not supported by fundamentals. The jawboning had the desired effect, the price of WTI oil falling 6% to around US$92 a barrel. That may have contributed to the negative effect on our oil and gas producers.

Here's three stocks that were slammed by the market today.

Billabong International (ASX: BBG) shares slumped 7.3% to close at $1.34, after the second bidder, Bain Capital, withdrew its $1.45 per share bid for the company. That leaves just private equity group TPG Capital as the lone bidder, its $695 million offer for the company the last man standing. Investors may have been spooked that TPG could also withdraw its bid – it seems Bain Capital found something it didn't like during the due diligence period.

Oil and gas play, Santos Limited (ASX: STO) lost 3.2% to end at $11.43, no doubt on the news mentioned above of the WTI oil price falling dramatically. Santos is one of Australia's largest oil and gas companies and is developing the US$18.5 billion Gladstone LNG (GLNG) plant in conjunction with Petronas, Total and Kogas. Santos holds 30% of that project.

Origin Energy Limited (ASX: ORG) slid 3% to close at $11.38. Another company expanding into oil and gas, Origin is developing the $23 billion Australia Pacific LNG project (APLNG), also located in Gladstone. Both GLNG and APLNG will be sourcing both conventional and unconventional gas (coal seam gas and shale gas) from various sources across Queensland.

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Motley Fool writer/analyst Mike King doesn't own shares in any company mentioned. The Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it's still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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