Australia: Shares suffer biggest drop in five months, partly due to strong currency

[SYDNEY] Australian shares posted their worst performance of the year so far on Tuesday, falling nearly 2 per cent, led by stop-loss selling while a firm Aussie dollar put pressure on exporters and companies with heavy US exposure.

All sectors were in the red with financials and resources shares leading the sell-off.

The S&P/ASX 200 index fell 109.9 points or 1.9 per cent to 5838.6 at the close of trade, its biggest decline since Dec 1. The benchmark ended down 0.6 per cent on Monday, after failing for the fourth time since early March to breach the 6,000-points barrier.

The index is set for its second straight monthly fall.

Since the Reserve Bank of Australia (RBA) cut its cash rate to 2.25 per cent in February the ASX benchmark has been moving in a 5,750-5,996 range. Analysts expect the market to head back towards the bottom of that band if the RBA keeps rates steady at its monetary policy meeting next Tuesday.

New Zealand's benchmark NZX 50 index fell 0.5 per cent or 28.84 points to finish the session at 5,740.82.

REUTERS