Shares moved lower over the week as mining, oil and gas, and resource services stocks suffered from a bleak outlook for new investment. Gains by the big four banks were not enough to lift the index.
The S&P/ASX 200 Index lost 0.3 per cent over the week to close at 5320 points. In a mostly quiet trading session on Friday, the index dropped 14.3 points, or 0.3 per cent, while the broader All Ordinaries shed 12.3 points, or 0.2 per cent, to 5314.3.
GrainCorp shares plummeted 22.1 per cent to $8.72, following a shock decision by the government to block a $3 billion takeover from US grain company Archer Daniels Midland.
Over the past five trading sessions local shares moved lower despite mostly strong leads from offshore. In the US, the S&P 500 and Dow Jones scaled new highs following a series of economic indicators that the housing and employment markets are strengthening.
"As the US recovery continues, how the Federal Reserve manages a reduction in stimulus, which is currently fuelling global liquidity, will be the most important global macro-economic theme over the coming year," Magellan Asset Management portfolio manager Dom Giuliano said.
Energy was the worst-performing sector over the week, down 2.5per cent as the crude oil price dipped 19¢ to $US110.86 a barrel. Australia's biggest oil producer, Woodside Petroleum, lost 2.2 per cent to $37.40, while other big players Santos, Oil Search and Origin Energy also finished lower.
The mining sector was mostly lower despite the spot price for iron ore, landed in China, dipping only 10¢ to $US136.40 a tonne.
On Wednesday, a Bureau of Resources and Energy Economics report said the number of new mining projects approved in the six months to October 31 was the lowest in more than a decade. It predicted more major projects will be shelved or delayed over the next three years. But the report also noted production is still increasing.
Australian Bureau of Statistics figures on Thursday showed an unexpected 3.6 per cent rise in business investment during the September quarter. Most surprising was a 4 per cent rise in mining investment. But mining companies were much less likely to be planning new investments this quarter.
Index heavyweight BHP Billiton dropped 1.2 per cent to $37.39 over the week. But Rio Tinto gained 1.2per cent to $66.06 as investors endorsed a decision to close its loss-making Gove alumina plant.
The closure of Gove was good news for Alumina, which jumped 7.3per cent to $1.02. Also bucking the downward trend in the mining sector was Whitehaven Coal, up 6.8per cent to $1.62.
Gold stocks were mostly lower as the spot price dropped to $US1242.78 an ounce at Friday's local close. Australia's biggest goldminer, Newcrest Mining, lost 9.9per cent to $7.69. But Oceanagold surged 8.8 per cent to $1.80 after finalising a takeover of Toronto-listed gold producer Pacific Rim Mining on Thursday.
Mining services business Forge Group plummeted 82 per cent to 75¢ after emerging from a three-week trading halt to reveal a $127million write-down.
Bank stocks were the strongest part of the market as the big four all closed higher. Commonwealth Bank of Australia rose 1.7 per cent to $77.82, while National Australia Bank added 1.9 per cent to $34.58. Westpac gained 1.2 per cent to $32.88, and ANZ rose 0.7 per cent at $31.90.