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[MELBOURNE] Australian shares gave up early gains to fall 0.1 per cent by midday on Tuesday, hauled down by top stock Commonwealth Bank of Australia and heavyweight blood products maker CSL after a disappointing result, while New Zealand shares rose.
The S&P/ASX 200 index fell 4.9 points to 4838.60 by 0145 GMT. The market earlier hit a five-day high of 4,871.20 in morning trade.
Commonwealth Bank of Australia, the top bank by market value and biggest property lender, initially fell as it was trading without rights to its dividend, but then sank to a nearly five-month low on worries the government may curb 'negative gearing' tax breaks on property investment.
"There's some frothy speculation about negative gearing that could be weighing on sentiment," said Michael McCarthy, chief market strategist at CMC Markets.
The worries weighed on National Australia Bank, which slipped 0.7 per cent, even though investors said there was nothing negative in its first quarter results, with unaudited cash profit up eight per cent.
"Generally, I thought it was pretty encouraging," said Rohan Walsh, a portfolio manager at Karara Capital.
Mining stocks helped shore up the market after iron ore, copper and nickel prices rose, with BHP Billiton up 2.6 per cent, Rio Tinto up two per cent and Fortescue Metals Group, one of the most active stocks, up seven per cent.
"It's the higher-risk, growth-exposed sectors that are really receiving support," CMC's Mr McCarthy said.
On the flip side, the gold sector, which has heavily outperformed the broader market amid uncertainty about global growth, sank two per cent on Tuesday, as investors shifted out of safe-haven gold.
Plasma therapy group CSL, which accounts for around four per cent of the benchmark index, fell 0.3 per cent after flagging that the Novartis vaccines business, which it recently acquired, is expected to report a loss for the year to June.
New Zealand's benchmark S&P/NZX 50 index rose 0.3 per cent or 17 points to 6,051.69 on Tuesday. Investors were cheered by a better lead from offshore but were also keenly awaiting company results this week.
The biggest gainers were A2 Milk, which added six per cent and Xero, which added 4.4 per cent.
The biggest losers were Spark, which shed two per cent and Trade Me, which fell 1.5 per cent. Both Spark and Trade Me are due to report this week.