For a second day in a row the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is in negative territory, this time with the health care and consumer staples sectors weighing down the index. In early afternoon trade the index is down 0.4% to 5,336 points.
Four shares which have acted as a drag on the index today are below. Here's why they have dropped lower:
a2 Milk Company Ltd (Australia) (ASX: A2M) shares have dropped 4% to $1.84 after analysts at Citi downgraded the growing milk company to a sell rating. According to a research note out of the investment bank, its analysts are expecting a tough year ahead for sellers of infant formula into the China market. At the current price, I think a2 Milk is starting to look like a great long-term investment option for investors.
Resolute Mining Limited (ASX: RSG) shares are down 7% to $1.65. Whilst the majority of Australian gold miners are trading lower today due to a pull back in the gold price, Resolute is also in the spotlight after releasing its quarterly production figures. Although gold production fell quarter on quarter from 83,087 ounces to 79,334 ounces, management maintained its full year guidance of 300,000 ounces at an all-in sustaining cost of US$934 per ounce.
SG Fleet Group Ltd (ASX: SGF) shares dropped sharply at the open, but have recovered to be down by 8.5% to $3.81 at the time of writing. According to the salary packaging and fleet management company's AGM presentation, management expects earnings growth in the range of 20% to 25%. This is far less than the 36% growth that analysts were expecting according to CommSec. This sell-off has made the shares reasonably attractive in my opinion, but not without risk.
Syrah Resources Ltd (ASX: SYR) shares have been hammered and are down over 9% to $3.57 a day after the graphite producer released its quarterly report. It would appear as though the market has taken exception to Syrah increasing its capital expenditure forecast at its Balama mine. Previously capital expenditure was expected to be US$175 million, whereas it has now forecast for it to increase to US$185 million. Although I think Syrah has a bright future, the sudden resignation of its manging director earlier this month is certainly a cause for concern.
