Australian shares are slipping at lunch, with the ASX 200 Index down 0.7 per cent following weaker commodity prices and the biggest tumble since early January in the US overnight. The ASX 200 was down by more than 1.2 per cent earlier in the day. IN PHOTO
Australian shares are slipping at lunch, with the ASX 200 Index down 0.7 per cent following weaker commodity prices and the biggest tumble since early January in the US overnight. The ASX 200 was down by more than 1.2 per cent earlier in the day. IN PHOTO: Australian shares are slipping for the third time this week with the ASX 200 Index down 0.4 per cent at lunch. Revisions to China’s growth targets for the year ahead has been a drag on the mining sector in early trade. A television journalist looks at a display board shortly after the local market opened at the Australian Stock Exchange in Sydney August 5, 2011. Australian stocks sank over 4 percent in opening trade on Friday, after worries about European sovereign debt and weakness in the U.S. economy hammered stock markets from Europe to Wall Street. Reuters/Tim Wimborne

The Australian share market seems to improve after the worst slowdown on Monday. The recovery of shares followed by the unexpected downfall seemed next to impossible. The share market moved up with 2.2 per cent on Tuesday, supplementing AU$30 billion (US$21.54 billion) to the main Australian companies.

The S&P/ASX200 saw deterioration in share values to 1.5 per cent at 4928.3 points, which surprised the share players with a positive move of 0.17 per cent that reached 5,009.6 points at 10:32 am (AEST) on Tuesday. All Ordinaries shifted to a flat graph with 5,014.2 points.

Analyst Ben Le Brun from OptionsXpress believed that the local buyers are trying their level best to hike bargain on Tuesday. “It’s not as bad as we were anticipating first thing this morning, that’s for sure,” he said. The analyst also said that banks are making things better in the market, which could foster investments very soon. In addition, he also warned the public to be prepared for unexpected changes followed by the market conditions of China.

Brun agrees that the Aussie market is not yet up-to-the-mark but the situation is better than what it was on Monday.

CMC chief market strategist Michael McCarthy said the investors in Australia were ready for another diminishing share market situation after the worst that already occurred. “The drivers of the selling are not simple. Some analysts are pointing to a stronger USD threatening fragile emerging market economies, others point to weaker China manufacturing data and a 36 percent fall in the Shanghai Composite Index,” he said.

The movement of shares in China will impact Australian market significantly, which may lead to further drops in the share value. After the loss of 4.1 per cent on Monday, it was being assumed that the loss on Tuesday would reach 3.66 per cent, but thankfully, the market remained stable.

Treasurer Joe Hockey, on the economic fluctuation, said that last week he met one of the senior authorities in China, who ensured that the China will put all possible efforts to foster economic growth. Hockey seemed confident about bringing the economy of the country to a stable level.

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