RTTNews - The Australian stock market opened on a weak note Tuesday with participants tracking Wall Street where stock prices tumbled overnight amid fresh concerns over the state of the U.S. economy and lower commodity prices.

As key stocks from energy, materials and financial sectors fell sharply on selling pressure, the Australian benchmark indices dropped down sharply this morning.

The S&P/ASX 200 index, which opened at 4,015, fell to 3,975 on heavy selling in resource-related stocks, but has recovered on bargain hunting at a few counters in subsequent trades.

Currently, the index is down by 40 points at 3,991.70. The All Ordinaries index is trading lower by 45 points at 3,985.

The S&P/ASX 200 index had ended down 30.50 points or 0.8% at 4,032 on Monday. The All Ordinaries index closed lower by 31.10 points or 0.77% at 4,030.

Materials stock Rio Tinto is trading lower by as much as 4.6%. Other key players in the materials space, BHP Billiton, Newcrest Mining, Orica and Fortescue Metals are also trading sharply lower.

Capital goods stock Leighton Holdings is down nearly 3%. Bank stocks are seen struggling despite trading off their lows.

Panax Geothermal Limited has launched a placement to institutional and sophisticated investors and a 1 for 4 accelerated non-renounceable entitlement offer to raise approximately A$9.3 million. The company will utilize the proceeds of the equity rising to fund the drilling of the Salamander-1 well at the Penola Project in South Australia, as well as for its working capital requirements. The company's stock is in a trading halt today.

Among economic news, the Reserve Bank of Australia is scheduled to release the minutes of its June 2 board meeting. Also, the New South Wales and Queensland governments are slated to deliver their budgets for 2009-10.

In the currency market, the Australian dollar is trading at 0.7909 to the U.S. dollar.

Stock prices fell sharply on Wall Street on Monday with traders going on a profit-taking spree. A report from the New York Federal Reserve that showed conditions for New York manufacturers have deteriorated at a faster pace in the month of June than in the previous month did play a key role in prompting investors to go for the sell button.

The Dow closed down 187.12 points or 2.1 percent at 8,612.13, the Nasdaq closed down 42.42 points or 2.3 percent at 1,816.38 and the S&P 500 closed down 22.49 points or 2.4 percent at 923.72.

Stock markets across the Asia-Pacific region closed mostly lower on Monday, as traders cashed in on recent gains. Japan's benchmark Nikkei 225 Index fell nearly 1 percent after trending higher in recent weeks.

Major European markets also saw considerable weakness, with the U.K.'s FTSE 100 Index ending the session down 2.6 percent, while the French CAC 40 Index and the German DAX Index fell 3.2 percent and 3.5 percent, respectively.

With data on U.S. housing starts, inflation and industrial production to come out today, the mood across the globe is likely to remain cautious.

Crude oil dropped on Monday on profit taking and a stronger dollar. Light sweet crude oil fell to $70.62, down $1.42 for the session. Earlier, oil hit as low as $69.58.

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