News Corp shares slump in Australia

Shares in Rupert Murdoch's News Corp. slumped more than three percent in Australian trade Thursday as the News of the World phone hacking scandal in Britain intensified. The locally traded stock dropped 62 cents, or 3.61 percent, to Aus$16.55 (US$17.78) on a broadly flat market, finishing the day as the S&P/ASX50's worst-performer. The fall mirrored the stock's slide on Wall Street on Wednesday, when the NASDAQ-listed News Corp. dropped 60 US cents, or 3.24 percent, to $US17.94. It followed revelations that the phones of relatives of people killed in the 2005 terrorist attacks on London's transit system may have been targeted. Murdoch condemned the claims as "deplorable and unacceptable", saying his company would "fully and proactively cooperate with the police". British Prime Minister David Cameron has backed calls for a public inquiry into the allegations, but said police should first complete their probe of the "absolutely disgusting" claims. Fat Prophets senior analyst Greg Fraser told Australian Associated Press the market move was an overreaction, given newspapers made only a small contribution to News Corp's earnings compared with its television properties. But it was no surprise given that Australian-born Murdoch was involved, he added. "There's no doubt that simply due to the profile that Murdoch has, any headline associated with him or his companies will potentially produce an outsized reaction," Fraser said .