Here’s why these 4 ASX shares are plummeting today

Credit: ryan melaugh

It certainly has been a disappointing day for the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO). The benchmark index has dropped lower by over 1% to 5,420 points today with every sector in the red.

Four shares which have performed even worse than the market are as follows:

Adelaide Brighton Ltd. (ASX: ABC) shares are down over 5% to $5.18 following the release of a disappointing half year result. Although revenue grew slightly to $686 million, net profit after tax dropped 6.7% to $77.1 million. Management provided full year net profit after tax guidance of between $190 million to $200 million, including an estimated $7 million net profit after tax from property transactions. This will be a disappointing drop from the $208 million net profit after tax it produced in FY 2015.

Independence Group NL (ASX: IGO) shares dropped over 4% to $3.65 after releasing its full year results to the market. Despite gold being at elevated prices this year, the miner posted a statutory net loss after tax of $58.8 million. Management has shrugged off the poor performance and believes FY 2016 has been about the creation of the future platform of growth for the company. If the gold price rises then the company may be poised to profit greatly. But that is a big if right now.

St Barbara Ltd (ASX: SBM) shares plummeted 7% to $2.83 following a broad sell off of the gold miners. With many believing that the US Federal Reserve could be about to raise interest rates at long last, the gold price has come under heavy selling pressure. All eyes will be on Friday’s US non-farm payroll release. A good reading on that piece of data could give the Fed the green light to raise rates in around three weeks’ time.

Slater & Gordon Limited (ASX: SGH) shares have continued their decline, this time by over 9% to 43 cents. Yesterday its shares dropped 13% following the release of its full year results which revealed a $1 billion loss. As tempting as it may be for bargain hunters, I don’t believe Slater & Gordon has the all clear just yet. The uncertainty around proposed changes to UK personal injury legislation is something which management is likely to have to work through next year. For this reason I would steer clear of its shares and focus on other areas of the market.

Instead of investing in Slater & Gordon I would highly recommend investors take a look at these three new breed blue chips instead. In my opinion these could be great additions that give your portfolio a real lift.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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