The Australian share market ignored positive economic data out of China and the US and instead started the week in the red, as investors ran scared following a shock profit warning from Australia's largest insurer QBE (QBE). The All Ordinaries Index (XAO) closed lower by 37.6pts or 0.7 per cent to 5148.4 points.
QBE plunged 22.3 per cent today to close at $12 per share, after downgrading its earnings guidance and confirming Chair Belinda Hutchinson will leave the company in March to be replaced by fellow director Marty Becker. Adverse weather out of the US including Superstorm Sandy and the worst drought North America has seen in 50 years have contributed to the profit warning. QBE now expects a $250M net loss for the calendar year 2013 and around $600 million in goodwill write-downs. CEO John Neal said today there is a clear need to restructure the North American business.
Elsewhere, logistics company and pallet provider Brambles (BXB) flagged a stronger first half profit, but left its FY14 profit guidance unchanged. BXB has estimated FY14 underlying profit of between US$930-965M for the year to June, a rise of 4-8 per cent. BXB shares fell one per cent today to $9.28.
Two companies listed on the ASX today. Adult education group Vocation (VET) rise 7.4 per cent on debut to $2.03 while childcare services provider Affinity Education Group (AFJ) rose 4 per cent to $1.04.
In economic news, job advertisements fell by 0.8 per cent in November with internet ads down one per cent and newspaper ads down 1.7 per cent.
On the market overall, a total of 2 billion shares changed hands, worth $5 billion. 388 were up, 551 were down and 330 were unchanged.
The Australian dollar ended the day's trade at US91.06c, £0.5562 and €66.34c.
Ahead tonight, the employment index is released in the US.
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