You are here

Australia shares lower for a second session; NZ down

asx.jpg

[BENGALURU] Australian shares extended their fall from the previous session as telecom, financial and basic material stocks declined, while investors also remained watchful of the US Federal Reserve's policy meeting outcome.

The S&P/ASX 200 index was down 59.865 points, or 1.01 per cent, to 5,890.5 at 0320 GMT. The benchmark had fallen 0.1 per cent on Tuesday.

The Federal Reserve is expected to hold interest rates steady at its two-day policy meeting.

The losses on the benchmark were led by the telecom sector which saw Vocus Group fall as much as nearly 30 per cent, its biggest intraday slide since March 2001, after it cut its forecast for the 2017 financial year.

sentifi.com

Market voices on:

In the financial sector, the 'Big Four' banks were down between 1.2 per cent and 2.4 per cent.

Australia's central bank held rates steady for a ninth straight month on Tuesday, as it balanced the risk of rising household debt against subdued inflation and wages growth. "As far as inflation is concerned, it's back in the band, so there is very little chance of a rate cut coming. It's more likely that next year there's going to be a rate rise," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.

In the context of such an outlook, banks may find it hard to grow as households may exercise some frugality, he adds.

Financial stocks were also lower as sentiment, soured by ANZ's half-year results miss in the previous session, kept investors sceptical ahead of National Australia Bank's half-year results due in the next session.

The basic material sector was pulled lower as BHP Billiton , Rio Tinto and Fortescue Metals fell between 0.7 per cent and 2.4 per cent. "Commodities have been falling for a bit now and will be continuing (to do so). We have seen weaker numbers out of the US and out of China, compared with expectations which is probably playing into it." Factory activity in the United States and China eased in April, with the latter slowing to its weakest in seven months.

Shares of Woolworth were down as much as 2.6 per cent, the biggest intraday fall in more-than a month, after two gaining days. The stock rose as much as 2.5 per cent in the previous session after posting strong quarterly sales numbers.

New Zealand's benchmark S&P/NZX 50 index snapped seven session of gains, falling 0.15 per cent, or 11.17 points to 7,411.32.

Financial sector lost as Australian and New Zealand Banking Group's continued fall at 2.9 per cent, pulled others in the sector lower.

REUTERS

Powered by GET.comGetCom