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Australian shares edge lower ahead of RBA decision; NZ slightly up

Tuesday, April 4, 2017 - 11:29

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[BENGALURU] Australian shares edged down on Tuesday, with financials accounting for nearly half the losses on the index, as investors awaited the central bank's decision later in the day.

The S&P/ASX 200 index shed 7.48 points, or 0.13 per cent, to 5,865.200 by 0231 GMT.

Australia's central bank is expected to stand pat on its cash rate at a record low of 1.5 per cent, a Reuters poll of economists showed on Friday.

"There's very little chance you're going to see a rate rise here, but quite clearly the heat in the housing prices on the eastern seaboard is now weighing heavily on their thinking," said James McGlew, executive director of corporate stock broking at Argonaut.

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"And I reckon if the underlying economy was a little bit more robust, then the interest rate rise will almost be a given."

Australian home prices hit new records while building approvals jumped the most in seven months, data from property consultant CoreLogic showed on Monday, even as regulators launched new measures to cool the red-hot property market.

Markets also took leads from Wall Street, as investors questioned whether US President Donald Trump's administration would deliver on its pro-business economic stimulus.

Financials declined 0.2 per cent, with the "Big Four" banks leading the losses.

Consumer stocks were the second biggest losers on the index, with Wesfarmers Ltd and Woolworths Ltd declining 0.6 per cent and 0.7 per cent, respectively.

Paring the losses on the index, material stocks gained nearly one per cent, with South32 Ltd leading the gains on the index.

Gold miners rose over three per cent as the yellow metal hit a one-week high buoyed by a weaker US dollar, and as investors turned to safe-haven assets over geopolitical worries.

Newcrest Mining Ltd gained 2.6 per cent and Evolution Mining Ltd rose 3.5 per cent.

Australian thermal coal prices rose to a four-month high on Monday due to a disruption to domestic exports from Cyclone Debbie, which struck last week.

The impact of the cyclone will hit coal mines operated by BHP Billiton Ltd and Glencore PLC, and raises the prospect of major producers declaring force majeure.

Shares of coal miners with assets in jurisdictions that were not impacted by Debbie surged.

Whitehaven Coal Ltd climbed 7.9 per cent, while New Hope Corporation Ltd gained 4.6 per cent.

New Zealand's benchmark S&P/NZX 50 index rose 0.1 per cent to 7,232.65 points, helped by gains in utilities and real estate stocks.

Electric utilities company Mercury NZ Ltd rose one per cent, while Property for Industry Ltd gained 2.5 per cent.

REUTERS

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