Australia: Shares reverse course to end lower as investors book profits

AUSTRALIAN shares closed slightly lower on Monday (Nov 14), reversing course from near five-month highs earlier in the session, as profit-taking in financial stocks more than offset a rally in commodity-related stocks after China eased some Covid-19 curbs.

The S&P/ASX 200 index closed 0.2 per cent or 11.7 points lower at 7,146.3. The index had risen as much as 0.54 per cent to 7196.5, its highest level since Jun 7, earlier in the day.

The index was largely pressured by a 1 per cent drop in financial stocks, with top lender Commonwealth Bank of Australia’s 0.7 per cent drop the biggest drag.

“(Banks and defensive stocks) have had a pretty good run but there is obviously some concern because maybe they got a little bit ahead of themselves in terms of the Federal Reserve and the pivot,” said Henry Jennings, a senior analyst and portfolio manager at Marcustoday Financial Newsletter.

The benchmark index closed 2.8 per cent higher on Friday, with banks rising 2.1 per cent, amid a global rally after data showed US October inflation hit its lowest since January, fuelling hopes that the Fed may turn less hawkish.

However, a central bank official has since put a damper on the optimism.

“I think there’s just some profit-taking in some of those industries and maybe some of that money is heading towards the resource sector,” Jennings added.

Local mining and energy stocks rose 3.7 per cent and 0.9 per cent, respectively, as China eased some Covid-19 curbs, boosting expectations of demand for commodities such as iron ore and oil.

Heavyweight miners BHP Group, Rio Tinto and Fortescue Metals Group finished 3.3 per cent to 10.1 per cent higher. Champion Iron topped the mining and benchmark indices, rising 12.9 per cent.

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Australia: Shares hover at 5-month high; miners soar as China eases curbs

Agribusiness Elders plunged 22.9 per cent and was the top loser on the index after it flagged headwinds to the season’s harvest due to flooding from extreme rainfall.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.7 per cent or 79.79 points to 11,231.97. REUTERS