The Australian share market is a sea of red today with many of the gains achieved during yesterday's relief rally simply vanishing. Here's why these five in particular are falling:
Sundance Energy Australia Ltd (ASX: SEA) fell 24.2% to just 25 cents, wiping more than $35 million from the company's market value. The energy producer is one of many oil companies getting hammered today after the global benchmark Brent Crude Oil price fell 3.9% overnight to US$47.69 a barrel. It's since fallen to US$47.17 a barrel with further falls expected.
Liquefied Natural Gas Ltd (ASX: LNG) isn't directly exposed to commodity risk, but the falling oil price (LNG prices are linked to crude prices) could reduce the perceived economic viability of its projects. The shares crashed 13% to $2.07, putting them down 58.6% since early May (ouch!).
Woolworths Limited (ASX: WOW) shares continued to be hit hard. The shares hit a fresh three-year low price of $24.71 shortly after 3pm this afternoon, but have since regained 10 cents to trade at $24.81 – down 2% for the day. Although the company's immediate outlook remains cloudy, Woolworths could be a reasonable pickup for long-term investors at its current price – especially with the stock offering a 5.6% fully franked dividend yield.
Healthscope Ltd (ASX: HSO) has fallen 4.2%, although the shares did fall as much as 7.7% earlier in the session. Healthscope's selloff can partially be attributed to the stock going ex-dividend today, while it could also be linked to the 350 million shares sold by private equity firms TPG and Carlyle Group. With the shares trading on a multiple of almost 32x earnings from the 2015 financial year prior to today, investors may have taken the divestment as reason to believe the shares have become overpriced.
Flight Centre Travel Group Ltd (ASX: FLT) fell into a nose dive, shedding 4% to trade at $35.76. Although the travel agency business didn't release any news which would specifically explain the fall, investors may be concerned that a local or even a global recession could impact demand for travel. Historically however, international travel trends have remained very consistent, remaining strong through events such as economic downturns, disease outbreaks and even terrorist acts.
