Australia: Shares cautious as investors await RBA decision, US election

[BENGALURU] Australian shares got off to a cautious start on Monday as investors avoided big bets ahead of a central bank rate decision and the US presidential election, with financials dropping after weaker results from the country's second-largest lender.

The S&P/ASX 200 index fell 0.1 per cent to 5,922.8 by 0015 GMT, recouping some losses after dropping to a near one-month low in the session. The benchmark index is on track for a third straight session of losses.

Investors were on the sidelines awaiting the Australian central bank's decision on Tuesday, where it is expected to cut key rates, with the threat of a contested election result in Washington adding to the caution.

"The worst case scenario for markets is a long period of electoral uncertainty, either through a close contest or a disputed result... The most immediate concern for markets is that political paralysis will delay or diminish a fiscal response to the deteriorating coronavirus situation," Michael McCarthy, chief market strategist at CMC Markets said in a note.

Financial shares, the benchmark's largest component, slipped 0.4 per cent after the country's second-largest lender Westpac Banking Corp revealed a 62 per cent plunge in full-year cash profit, sending its shares nearly 2 per cent lower.

Embattled wealth manager AMP jumped 8.8 per cent after it said the proposed takeover offer from Ares Management had an implied value of A$1.85 a share, a 21 per cent premium to Friday's closing price.

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Technology shares and energy stocks fell 0.9 per cent and 0.5 per cent, respectively.

New Zealand's benchmark S&P/NZX 50 index dropped half a per cent to 12,024.7 and was also trading lower for a third consecutive day.

REUTERS