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Action-seeking investors punish market

The S&P/ASX 200 index (Index: ^AXJO) fell 1.1% to 4,221.5 after European policymakers sat on their hands overnight, amid yet more reassuring words and no positive action.

Overnight, the Dow Jones Industrial Average fell 0.7%, while the UK’s FTSE 100 Index slumped 0.9%.

Despite heading for 106 US cents at one stage, the Australian dollar is back trading around the same levels as yesterday versus the US dollar, buying around 104.8 US cents.

It’s not just James Packer that wants a casino. Fairfax news reports suggest Clive Palmer plans to build a multi-billion dollar casino complex, including an international airport and a hovercraft station at his Coolum Palmer Resort on the Sunshine Coast of Queensland.

In car news, just 941 Ford Falcons were sold during July, according to the latest industry data from The Federal Chamber of Automotive Industries, despite a booming new car market. According to the report, sales of SUV’s have grown 32% compared to the same period last year. Total new vehicles sold since the beginning of 2012 were 10% higher than 2011.

Company news

BHP Billiton Limited (ASX: BHP) has announced writedowns of more than US$3 billion on its US shale gas and Western Australian nickel operations, due to lower gas and nickel prices respectively. Analysts have already started cutting their earnings forecasts for future years, with CBA analysts reducing forecasts by 5%. Shares in the big miner fell 2.3%, to close at $31.30.

Meanwhile, shares in CSL Limited (ASX: CSL) fell 2.6% to $40.28, after the company announced that CEO, Brian McNamee was leaving after 23 years as head of the company. Investors were likely worried the incoming replacement may not be as good as Mr McNamee.

Winners and losers

The big winner from the ASX200 index was Resmed Inc (ASX: RMD), with the company’s shares jumping more than 9% to $3.30, after the company posted a 12% rise in annual profit.

From the top 50 stocks, Telstra Corporation (ASX: TLS) and Crown Limited (ASX: CWN) were the best with rises of 0.8% and 0.5% respectively

Of the majors, Alumina Limited (ASX: AWC) posted the biggest fall, dropping 6.4%, while Leighton Holdings Limited (ASX: LEI) and Rio Tinto Limited (ASX: RIO) both lost more than 4%.

Foolish takeaway

Markets struggle to be patient, and that’s likely the reason for today’s fall. Foolish investors know better than to sell on days like today.

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More reading

Motley Fool writer/analyst Mike King owns shares in BHP and CSL. 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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