Rio Tinto shares plunged as much as 16.3 per cent on the Australian Stock Exchange yesterday, recording one of their single biggest intra day falls since the October 1987 stock market crash, writes Peter Smith in Sydney.

It followed a denial from Rio that it was in talks with its Anglo-American mining rival and hostile suitor BHP Billiton to negotiate a takeover deal. The shares eventually closed down 14.6 per cent at A$66.95 in Sydney.