Well the day started off alright, with the All Ordinaries (Indexasx: XAO) (ASX: XAO) up around 0.5% at lunchtime. But since then the market has caved in, thanks mainly to falls in the big resources stocks and a number of insurers.
These six stocks were heavily sold off.
Pharmaxis Ltd (ASX: PXS) plummeted 9.6% to 8 cents, despite no recent news from the company. As we have previously mentioned, investing in the highly speculative biotechnology space is risky business. Results can take many years to come to fruition while one miss-step can see the shares plunge dramatically. That applies equally to Pharmaxis, which is developing a treatment for lung diseases such as cystic fibrosis.
BC Iron Limited (ASX: BCI) and Fortescue Metals Group Limited (ASX: FMG) plunged 7.4% and 5.6% to 37.5 cents and $2.02 respectively, after iron ore prices fell 1.5% overnight to US$58.58 per tonne, the lowest price since May 2009 according to one source. News that net supplies will increase to around 75 million this year is likely to put further downward pressure on the commodity price.
Monadelphous Group Limited (ASX: MND) continues to fall as the resources contractor faces the equally unpleasant prospects of much lower margins on contracts it can win, or no contracts at all. Resource investment dollars continue to dry up, putting more pressure on mining services companies. Shares fell 10% today to $8.80, although 46 cents of that was due to the shares going ex-dividend today.
Maverick Drilling and Exploration Ltd (ASX: MAD) slumped 9.7% to 14 cents, despite no news from the company. It may simply be fund managers selling out of the small US oil producer after Maverick was kicked out of the All Ordinaries index by Standard & Poor's on Friday. With the oil price down more than 50% since June 2014, it remains to be seen how Maverick will position itself in the future.
Flight Centre Travel Group Ltd (ASX: FLT) saw its shares dumped, losing 4.6% to close at $41.29 as investors freaked out over the falling Australian dollar, which is now trading at around 76.7 US cents. As we pointed out in December 2014, Australians continue to travel overseas in ever greater numbers – no matter where the exchange rate is – and has no effect on Flight Centre's earnings.
