The sharemarket finished lower on Tuesday, but rose from the day's trough after the Reserve Bank cut official interest rates to their lowest in more than 50 years.
The benchmark S&P/ASX 200 fell 12.5 points, or 0.2 per cent, to 5143.7, while the broader All Ordinaries fell 11.1 points, or 0.2 per cent, to 5122.7.
The materials sector continued on Monday's good form, rising 2 per cent, following strong performances in commodity markets last week. BHP rose rose 2.4 per cent to $33.67, Rio Tinto 2.1 per cent to $57.39 and Fortescue Metals 2.2 per cent to $3.69.
"We might be seeing the start of some type of rotation of money out of the good performers and into the beaten-up cyclical growth companies," RBS Morgans senior trader Luke McElwaine said. "But one swallow doesn't make a summer, as Warren Buffett would say."
The RBA cut the official cash rate by 25 basis points to 2.75 per cent, the lowest since the central bank began setting rates in 1990 and a level not seen since 1959.
Before the announcement, the ASX 200 was down 0.7 per cent.
Despite outperforming most of the market this year, the big banks finished lower.
CBA fell 1.9 per cent to $70.30, ANZ 1 per cent to $31.19, NAB 1.6 per cent to $32.95 and Westpac, going ex-dividend on Monday, fell 1.8 per cent to $32.58.
The rate decision also hit the Australian dollar, which reached a two-month low, falling from above US102.40¢ to US101.93¢ in late trading.
Coca-Cola Amatil fell 10.5 per cent to $12.93, after it said it expected a fall in first-half earnings.