Hedge funds blamed for market slump

The sharemarket fell more than 2.5 per cent as investors wiped another $25 billion off its value in the biggest one-day fall in almost five years.
BHP Billiton alone accounted for $5 billion of the losses.
The ASX 200 fell 127.1 points, or 2.56 per cent, to 4838.9 while the All Ordinaries fell 119.6 points, or 2.43 per cent, to 4807.2.
Aequs Securities institutional dealer Ric Klusman said global hedge funds playing in the commodity market had been hit and were dumping their investments.
"Unfortunately, they're taking us with them," Mr Klusman said.
On the Sydney Futures Exchange, the June share price index contract fell 107 points to 4834. CMC Markets senior dealer Phil Martin said the intensity of the selling surprised a lot of investors.
"There is certainly the hope that there will be some respite from the selling but we aren't seeing a lot of it at the moment," Mr Martin said.
Mr Klusman said investors would monitor data coming out of the US in the next few days, including inflation figures.
"There could be a big rally or another big fall depending on the results," Mr Klusman said.
The sharemarket's initial decline was triggered by a fall in the US overnight, where the Dow Jones lost 99.34 points to 10,792.58.
It was the second time in less than a week that about $25 billion had been slashed from the market's value.
The benchmark index lost 2.35 per cent last Thursday, until yesterday the biggest fall since September 17, 2001, when the market lost 4.69 per cent following the September 11 terrorist attacks.
BHP fell $1.48, or 5.5 per cent, to $25.25 and Rio Tinto fell $2.87 to $70.90. BHP announced just before the closing bell that it was forming an alliance with Russia's biggest miner, MMC Norilsk Nickel, to carry out exploration and develop mining projects in the Russian Federation.
Oil and gas producer Woodside fell $1.22 to $40.12.
Banks were caught up in the sell-off. ANZ fell 65c, or 2.5 per cent, to $25.65, NAB 85c to $33.95, the Commonwealth Bank to $42.22 and Westpac 45c to $22.
Woolworths was one of the few winners on the day, rising 9c to $18.75, while David Jones added 5c to $2.93.
Coles Myer fell 15c to $11.44.
In the media sector, News Corp fell 54c to $26.18 and its non-voting scrip was down 49c to $24.93. Publishing & Broadcasting Ltd fell 36c to $17.80 while Fairfax fell 6c to $3.76.
Telstra eased 3c to $3.72, while Optus-parent Singapore Telecommunications also fell 3c to $2.03.
ABC Learning Centres, which said its takeover of Kids Campus would proceed following a strong flow of acceptances, fell 37c to $6.36.
Among the gold stocks, Newcrest fell 84c to $18 and Newmont fell 13c to $6.50.