Australia: Shares fall after NAB results; NZ up on consumer staples

[BENGALURU] Australian shares were flat on Thursday as gains in the materials sector on an uptick in metal prices were counteracted by losses in financials as National Australia Bank's results revealed slipping margins.

The S&P/ASX 200 index was nearly unchanged at 5,937.2 by 0052 GMT. The benchmark rose 0.5 per cent on Wednesday.

The country's No.3 lender by market value, NAB, slipped as much as 3.3 per cent, its biggest percentage loss since May 16, after it said it foresees a spike in expenses between five to eight per cent over the year ahead and it would cut 6,000 jobs by 2020.

The Melbourne-based bank said its annual cash profit rose 2.5 per cent to a record high although it expects A$500 million to A$800 million in restructuring costs in the first half of fiscal 2018.

"One of the big plays in banks globally is the steepening of yield curves," said Damien Hennessy, co-founder of Heuristic Investment Systems.

"A lot of the Australian banks' loans are on variable rates, they do not really benefit from the steepening yield curve which has supported some of the banks globally."

The financial index slipped as much as 0.9 per cent, led lower by NAB. It trades at a Price to Earnings ratio of 14.98, according to Thomson Reuters Eikon data.

"Our banks have been very expensive relative to global peers and the banks are just coming back to the pack, somewhat, in the past few months," added Hennessy.

In the mining sector, Nickel prices jumped four per cent to their highest since June 2015 while zinc and copper also rose.

BHP Billiton and Rio Tinto gained as much as 2.1 per cent and 2.2 per cent, respectively.

South32 Ltd, a miner of alumina, jumped as much as 5.1 per cent to hit a record high, and was the top gainer on Australian mining index.

From a macroeconomic view, the country's trade surplus widened to A$989 million in August, ahead of expectations of A$875 million, according to economists polled by Reuters.

In New Zealand, the benchmark S&P/NZX 50 Index rose 0.2 per cent, or 18.73 points, to 8,072.54, helped by gains in consumer staples.

a2 Milk, the index's biggest boost, rose 4.4 per cent. Till Wednesday's close, the dairy company had gained about 273 per cent since the start of the year.

REUTERS