Aust stocks close weaker

Local market follows global bourses lower as investors switch from shares to bonds.

The Australian sharemarket has followed global bourses lower today after a weaker than expected European GDP data and some switching from equities into bonds.

At the 4.15pm (AEST) official market close, the benchmark S&P/ASX200 index shed 31.8 points, or 0.58%, to 5,479 and the broader All Ordinaries index gave up 31.3 points, or 0.57%, to 5,458.9.

CMC Markets chief market analyst Ric Spooner said the downbeat European GDP print and weaker leads from Europe and Wall St weighed on the local market, but also noted significant buying of bonds over the last few days.

"We may be seeing some asset switching going on. People perhaps are lightening off on equities and getting into bonds," Mr Spooner said.

"It's a question of people rightly or wrongly beginning to look at the fact that inflation is still very well behaved in most places around the world and it looks as if that will be the case for some time to come.

"Equities are by no means overpriced but they're fairly fully priced and the market's struggling to gain upside momentum. Every time we jump, we encounter profit taking."

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