Financials weigh on Australia shares after inquiry announced; NZ rises

[BENGALURU] Australian shares fell on Thursday, dragged down by financials after the government announced an inquiry into the banking sector and by resources stocks as metal prices fell.

The government said it will hold a wide-ranging inquiry into the finance sector, throwing the spotlight back onto an industry which has sought to move on from a series of scandals ranging from misleading financial advice to breaches of anti-money laundering protocols.

The S&P/ASX 200 index ended down 0.7 per cent or 41.215 points to 5969.9 at the close of trade. The benchmark gained 4.6 per cent over the month.

Aussie financial index slipped 0.8 per cent, with Commonwealth Bank of Australia falling nearly 2 per cent and Australia and New Zealand Banking Group sliding 1.1 per cent.

"The current Liberal government had been resisting this push - it was seen as some undermining the four pillars policy with regards to the Australian banks being too big to fail during the global financial crisis," said James McGlew, executive director of corporate stockbroking at Argonaut.

"But since then, there have been concerns with regard to the performance of a number of banks. There have been a number of scandals with CBA being hit with the most recent one. So the market has taken a big stick to the banks." Material stocks ended lower, with mining major BHP's 1.2 per cent fall weighing on the sector index. The mining index fell 1.6 per cent but still advanced 3.9 per cent in November.

Base metals declined on Thursday and looked to finish November lower, shrugging off encouraging manufacturing reports from China and Japan as investors locked in profits before year end.

Index heavyweights Rio Tinto was down over one per cent while Newcrest Mining fell 3.1 per cent.

In New Zealand, the benchmark S&P/NZX 50 index ended up 0.6 per cent or 44.86 points at 8,186.82. It gained 0.7 per cent over the month.

The consumer sector led the gains on the index but industrials and utilities were a drag.

Airport facilities provider Auckland International Airport Ltd was the biggest loser on the benchmark falling 2.2 per cent, while shares of SKYCITY Entertainment Group Ltd and a2 Milk Company Ltd were buoyant, rising 4 per cent and 1.2 per cent respectively.

REUTERS