The highly anticipated debut of South32 Ltd (ASX: S32) has failed to add a spark to the Australian sharemarket on Monday, with the benchmark S&P/ASX 200 (Index: ^AXJO) (ASX:XJO) having retreated more than 0.8% late in the session.
While the losses have been widespread throughout the market, here are four blue-chip stocks that are causing most of the damage.
BHP Billiton Limited (ASX: BHP) experienced its biggest decline in more than six years, falling by a massive 7.4% to $30.10 which represents a fall of $2.39 per share. The fall came after the miner cut more than $10 billion worth of assets into the newly formed South32 Ltd which opened for trade at $2.13 at noon. Investors who owned the stock leading into today have been allocated one new share in South32 for every BHP share held, meaning that the drop hasn't been as severe as it might seem at first.
Medibank Private Ltd (ASX: MPL) is trading 0.9% lower at just $2.14 as investors continue to exit the health insurer. While the stock attracted plenty of attention and hype in its first few months as a publicly-listed entity, that excitement now appears to be wearing off rapidly with the stock having plunged more than 17% since peaking in February.
Coca-Cola Amatil Ltd (ASX: CCL) has also retreated 1.4% to trade at $10.06 after lifting by more than 3% last week. The stock may be under selling pressure after management said that conditions in the Australian market remained tough while demand remained weak in Indonesia.
This may prompt some investors to believe the company's turnaround isn't going as strongly as they'd hoped. Although the near-term outlook remains unclear, the stock still presents as an excellent long-term buying opportunity.
Commonwealth Bank of Australia (ASX: CBA) has also fallen back into the red zone today, retreating 1.4% after managing a 2.6% lift last week. While it is widely recognised that Australia's major banks have become overpriced, they have each come under intense selling pressure in recent weeks after they released their latest earnings figures, revealing a number of headwinds that could threaten their growth potential.
Should the banks continue to fall, there is a very real chance they could drag the rest of the ASX 200 down with them due to the concentrated nature of Australia's markets. As such, it is vital that investors remain prepared for whatever might come their way.
