Australia: Shares down, but NZ stocks sets record peak

[SYDNEY] Australian shares fell on Friday as declining commodity prices sapped appetite across the board, putting shares on track to end the week sharply lower - in contrast with New Zealand stocks which scaled another all-time high.

The S&P/ASX 200 index dropped 0.6 per cent, or 37.9 points to 5,811.4 points by 02:49 GMT. The benchmark climbed 1 per cent on Thursday, its biggest daily rise in a month. "It looked like investors closed long positions ahead of the weekend and (that) wrapped up the mood," said Kara Ordway, market strategist at City Index.

The benchmark was down 1.4 per cent for the week, the biggest such loss since mid-January, pulling away from a 7-year peak touched earlier this month.

Mr Ordway said sentiment was hurt as recent economic figures failed to impress bulls. "Jobs (data) was fairly standard, business and consumer confidence were the biggest concerns, particularly for the Reserve Bank of Australia." Not helping were the plunging prices of iron ore .IO62-CNI=SI , Australia's top export earner.

Large miners BHP Billiton and Rio Tinto were down 1.6 per cent and 0.5 per cent, respectively, extending recent losses. Rare earths miner Lynas slumped 4 per cent after receiving yet another debt extension from its lenders.

The energy sector also took a hit with Santos off 2.5 per cent, while financials shed 0.7 per cent.

The one bright spot came from the telecommunications sector after TPG Telecom offered to buy domestic Internet services provider iiNet for A$1.4 billion.

Shares in iiNet surged 25 per cent and TPM's up 16 per cent, while rival operator Telstra shed 0.8 per cent.

New Zealand NZX-50 index scaled another record peak of 5,911.6 to be last up 0.3 per cent at 5,906.73.

The market's high yield attraction was underscored by the central bank's monetary statement the previous day which pointed to interest rates staying low for longer.

The rise was propelled by a 3.9 per cent rise in software company Xero, a top-10 stock, to NZ$25.30 as it confirmed its recent capital raising and share issue had been completed.

The number two stock telecommunications company Spark was 1.6 per cent higher at NZ$3.245, with smaller rises for other leaders Auckland International Airport and Sky City.

Mid-and-small cap stocks were also in demand, albeit on modest volumes, with dairy giant Fonterra's shareholders' fund units up 0.9 per cent, a 4.1 per cent gain for Metro Performance Glass, and 1.7 per cent gains for Genesis Energy and stock exchange operator NZX.

REUTERS