Article from the West Austarlian this morning. All things...

Article from the West Austarlian this morning. All things considered....PRR is not doing too badly.

http://au.news.yahoo.com/thewest/a/-/newshome/8334451/market-slumps-on-debt-fears/

UPDATE 9.50am: The Australian sharemarket has slumped more than 2 per cent this morning wiping about $30 billion off the value of shares.

The sharp falls mirrored a plunge on Wall Street overnight where investors were spooked by discouraging US economic data and ongoing fears about the country's debt as well that of Europe.

By mid-morning the benchmark S&P/ASX200 index was down 97.9 points, or 2.2 per cent, to 4335.7 while the broader All Ordinaries index was down 97.6 points, or 2.2 per cent, to 4412.7.

US stocks overnight lost most of their gains for 2011, as poor economic data overshadowed a congressional deal to raise the country's debt ceiling and avoid default.

China's state news agency Xinhua said today the US debt deal had "failed to defuse Washington's debt bomb".

A failure to rein in US borrowing could "jeopardise the well-being of hundreds of millions of families within and beyond the US borders", Xinhua said in a commentary.

China, sitting on the world's biggest foreign exchange reserves of around $US3.20 trillion ($A2.98 trillion) as of the end of June, is the largest holder of US Treasuries.

Overnight, the Dow Jones Industrial Average lost 265.87 points, or 2.19 per cent, to 11,866.62.

The broader S&P 500 dropped by 2.56 per cent and the tech-heavy Nasdaq Composite shed 2.75 per cent.

European shares also fell sharply amid signs of contagion in the eurozone, with concern now focusing on Italy and Spain.

Austock Securities senior client adviser Michael Heffernan said the local market had followed Wall Street down in the wake of downbeat US economic data, released overnight.

Consumer spending in the US dropped 0.2 per cent in June, its first decline since September 2009.

"There's a bit of blood on the floor," Mr Heffernan said.

"It's on the back of poor US figures, no question, and the general malaise around the world, and it's just infected us."

The two key miners both fell more heavily than the market overall. BHP Billiton shed $1.21, by almost three per cent, to $40.36, while Rio Tinto lost $2.10, over 2.5 per cent, to $77.95.

Banks, too, opened lower. National Australia Bank fell 56 cents to $23.41, Westpac lost 45 cents to $19.92, ANZ was down 47 cents at $20.35, while Commonwealth was 82 cents lower at $48.60, falling less than its peers for the second day running.

The price of gold in Sydney was $US1,654.00 per fine ounce, up $US29.03 from $US1,624.97 at close on Tuesday.

Gold miner Newcrest was up 56 cents, or 1.4 per cent, at $40.59.
BlueScope Steel was the worst performer in the top 100, shedding 6.5 cents, around six per cent, to $1.045.