Australian shares flat as BHP slumps; a2 milk soars on results, Fonterra deal

[BENGALURU] Australian shares finished flat for a second consecutive session on Wednesday, as losses in BHP , the country's biggest company by market capitalisation, offset gains in consumer staples and real estate stocks.

The S&P/ASX 200 index ticked up 0.1 per cent or 2.8 points to 5,943.700 at the close of trade. The benchmark edged down 0.688 points on Tuesday.

Shares of BHP slumped 4.8 per cent, their steepest loss in more than 11 months. The world's biggest miner reported a 25 per cent rise in half-year underlying profit to US$4.05 billion, but missed estimates of US$4.30 billion according to Thomson Reuters.

A strengthening in the US dollar was also driving a weakness across the broader materials sector, with mining stocks under pressure.

A firmer greenback tends to put price pressure on commodities, of which Australia is a major exporter.

Global miner Rio Tinto Ltd lost 1.6 per cent and was among the biggest drags on the index, while South32 Ltd fell 2.5 per cent to a near four-month low.

Australia-listed shares of a2 Milk Company rose 29.7 per cent to a record high and accounted for most of the gains on the benchmark.

a2 Milk posted a record half-yearly profit on Wednesday, helped by surging demand for its infant formula products in China, and announced a supply agreement with Fonterra that would help it expand in the United States.

Gains in retail-to-mining conglomerate Wesfarmers also helped cement profits in the consumer staples sector.

Wesfarmers shares rose 3 per cent to a two-week high, despite the company posting its lowest first-half profit in more than a decade.

Real estate stocks also rose, with property developer LendLease Group being the biggest sectoral gainer as it rose 6.5 per cent to its highest in more than 18 weeks.

LendLease reported an 8 per cent rise in half-year profit, underpinned by strong performance in its development and investment segments. Meanwhile, a2 Milk Company Ltd's New Zealand shares soared 26.5 per cent to a record high and accounted for most of the gain on the NZX.

The benchmark S&P/NZX 50 index climbed 1.3 per cent or 102.000 points to finish the session at 8,200.270.

REUTERS