Australia: Shares dip as financials extend losses

[SYDNEY] Australian shares softened on Friday, as the financial sector sagged on concerns over the effects of a tax on banks and potential slowdown in the housing market.

The S&P/ASX 200 index, which fell for the last two sessions, slipped 0.3 per cent, or 17.012 points, to 5,721.3 by 0250 GMT. The benchmark dropped 0.8 per cent on Thursday.

The financial sector accounted for more than half of the indexe's losses, with the "Big Four" slipping 0.7-2 per cent.

Australia and New Zealand Banking Group dropped 2.2 per cent at one point to its lowest in five months.

The benchmark index of financial stocks, which fell for the past three days, dipped 1.2 per cent to its lowest in three months.

"Our markets are being brought down by selling in the bank stocks," said Ric Spooner, chief market strategist at CMC Market.

Global stocks and their financial sectors are coming under pressure on concerns about the political situation in the United States, Mr Spooner said.

"But our bank stocks are falling on local concerns. The imposition of the bank tax and also due to a potential slowdown in the housing market," Mr Spooner added, referring to a new tax on banks in this month's federal budget.

The government announced a six basis points levy on the deposits of the country's five biggest banks in its annual budget, a measure that will deliver A$6.2 billion (S$6.41 billion) through to 2020/21 as it aims to get its finances back into the black.

Gold prices retreated following a bounce in the dollar, after rising to near two-week highs on Wednesday on growing uncertainty over the future of Donald Trump's presidency.

Newcrest Mining fell more than three per cent, snapping two sessions of gains.

The country's top billboard company oOh!media Ltd edged lower on its sixth straight day of losses after its rival APN Outdoor Group Ltd dropped plans to buy the company as the antitrust regulator raised concerns.

The materials sector was the only sector in positive territory with diversified miner BHP Billiton leading, on the backdrop of upbeat Shanghai steel and oil prices.

BHP aims to start potash production at Jansen, Saskatchewan in 2023 and plans to produce 4 million tonnes annually. The miner, under pressure from activist investor Elliott Management to review its assets, said its open to taking on a partner in Jansen, but added that there are no ongoing talks.

New Zealand's benchmark S&P/NZX 50 index inched up 0.3 per cent, or 20.28 points, to 7,392.04.

Material stocks dominated gainers, with Fletcher Building, up as much as 1.5 per cent.

REUTERS