The Australian sharemarket is on fire today following a strong night for equity markets around the world. By early afternoon, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) was trading 0.9% higher at around 5847 points, led by the nation's banks and miners.
Unfortunately, not every company has enjoyed the same success today with some being punished by investors. Here's why…
Village Roadshow Ltd (ASX: VRL) is trading 1.5% lower at $5.42, extending on yesterday's 3.4% decline. One of the entertainment and media group's Gold Coast theme parks (Movie World) was in the news for all the wrong reasons over the weekend when one of its rides malfunctioned, leaving 13 passengers stranded for hours. Although no one was injured, it's possible investors are concerned about the short-term impact on attendance the malfunction could have.
Sundance Energy Australia Ltd (ASX: SEA) has watched its shares tumble 4.4% to just 50.2 cents following another bad night for oil prices. US oil prices fell to a near six-year low on Monday upon oversupply concerns, whereby the US is sitting on its greatest inventory levels in 80 years. Sundance is just one of Australia's energy stocks being sold off today, with its shares now down 64% since August.
Slater & Gordon Limited (ASX: SGH) has also fallen 2.4% to $7.24 on reports that it could pay up to £640 million for the legal services division of Quindell Plc. It's very possible that investors are concerned about that price tag, even though Slater & Gordon stated that no offer has been put to Quindell and that there is no certainty that a transaction will eventuate.
Sirtex Medical Limited (ASX: SRX) has been the market's worst-performing stock (by far) today, tumbling to a low of just $14.80. It has since recovered marginally to be trading at $17.90, down 54.1% for the day. To summarise the events leading to the biotech's massive fall, the company released the results of its specialised liver cancer treatment which unfortunately did not result in a "statistically significant improvement in the overall Progression-Free Survival (PFS)". Given the stock's lofty valuation prior to the announcement, the heavy sell-off perhaps shouldn't have come as a surprise.
