Why Wesfarmers Ltd is among 4 shares tumbling today

Australia’s benchmark share index the S&P /ASX200 (ASX: XJO) is 1% lower to a 52-week low of 5,613 points today as US and European shares fall on concerns over the Brexit deal in the UK and rising interest rates in the US.

Some shares are faring far worse than the index though, so let’s take a look at what might be behind the price moves of some of today’s worst performers.

The Nanosonics Ltd (ASX: NAN) share price is down 6% to $2.87 today, despite the hospital disinfectant medical device provider releasing no specific news to the market. In FY 2018 the group posted a profit before tax of $5.6 million, down from $13.9 million in the prior year as it continues to invest heavily for the future in new products, staff, and marketing. If these investments pay offm then Nanosonics may have a bright future.

The Origin Energy Ltd (ASX: ORG) share price is down 4% to 6.54 today despite the electricity retailer and LNG producer releasing no specific news to the market. Origin’s flagship Australia Pacific LNG asset is dependent on LNG prices that are linked to wider energy and oil prices. Unfortunately for Origin, oil prices have tumbled over the past month. Worse is that overnight Brent Crude and WTI futures fell close to 5% in another leg lower, it’s this price action that’s dragging Origin shares lower.

The Santos Ltd (ASX: STO) share price is also down 3.5% to $5.77 in morning trade as the group’s flagship Gladstone LNG  production and shipping asset is reliant on LNG prices as well. WTI futures are now selling for just US$54.14 compared to prices around US$69 just one month ago. The steep fall in energy prices is taking Santos shares lower. On top of this the group still has a significant debt pile after investing heavily to build its Gladstone project.

The Wesfarmers Ltd (ASX: WES) share price is down 28% to $31.42 today but there’s no need for shareholders to panic because the investment conglomerate’s demerger and listing of Coles supermarkets came about as of today. In effective compensation for the 28% or so loss in value of their Wesfarmers holding, shareholders should have received a roughly equivalent amount in Coles shares. In fact eligible shareholders should have received one Coles share for every Wesfarmers share held and now have an ownership interest in the supermarkets business.

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Motley Fool contributor Yulia Mosaleva has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nanosonics Limited and Wesfarmers Limited. 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 Scott Phillips.

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