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Australia shares fall on telecoms, geopolitical risks; NZ flat
[BENGALURU] Australian shares edged lower on Wednesday, snapping three straight sessions of gains, due to a sell-off in some telecom companies and rising geopolitical risks in the Middle East and Asia.
The S&P/ASX 200 index slipped 0.2 per cent, or 11.874 points, to 5,917.4 by 0250 GMT. The benchmark closed 0.3 per cent up on Tuesday.
Shares of Telstra Corp dropped as much as 8.6 per cent to its lowest level since 2012, after rival TPG Telecom Ltd won an auction for mobile phone airspace that will pave the way for the firm to bring services to 80 per cent of the population.
Telstra was not allowed to bid in the government auction because of its dominant market position. TPG stocks were suspended ahead of the announcement and will not resume trading until April 18.
"Those that want to take up (TPG's) offer are not able to hedge themselves in TPG as the stock is still suspended," said Michael McCarthy, chief market strategist at CMC Markets.
"So another way to get into the offer would be to sell off another major telecom stock. Part of the pressure on Telstra today is coming from investors lightening up in the sector."
Telecoms services provider Vocus Group Ltd also plummeted as much as 5.9 per cent to more than a three-year low.
"There isn't a direct correlation between the stocks but rather elements of a proxy hedge in selling Telstra and Vocus," Mr McCarthy added.
Healthcare stocks were another drag, with CSL Ltd losing over one per cent and Mayne Pharma Group Ltd dropping to almost a three-week low.
Stocks were also under pressure from rising geopolitical tensions over US relations with Russia and North Korea, sending investors to safer assets. Gold hit a five-month high.
St Barbara Ltd extended gains for an eighth straight session, hitting a six-month high. Newcrest Mining Ltd and Evolution Mining Ltd rose 2 per cent and 1.3 per cent, respectively.
Financials were largely subdued with two of the "Big Four" banks flat. ANZ edged up 0.5 per cent and Westpac Banking slipped 0.3 per cent.
"If we look at the financial sector, it's somewhat below its previous high mark. There's an element of 'catch up' that we're seeing from the banks today with regards to their support to the index," said Mr McCarthy.
In New Zealand, the benchmark S&P/NZX 50 index was down 0.1 per cent, or 4.38 points, to 7,250 points, touching a one-week low.
Materials and industrials led the losses.
The country's largest building firm Fletcher Building Ltd was the biggest loser, falling nearly 2 per cent.