AUSTRALIAN shares went into reverse yesterday, giving back a quarter of Monday's gains, as investors awaited key domestic inflation data and the outcome of tonight's meeting of European leaders on the euro-zone debt crisis.
The benchmark S&P/ASX 200 Index closed down
27.1 points, or 0.64 per cent, at 4227.9.
CommSec market analyst Tom Piotrowski said that despite a strong session in the US overnight, investors had become a little wary.
There had initially been a lot of optimism about the European bailout package, he said.
Early on, people expected a "shock and awe" solution, but that attitude had abated.
"The volatility of the markets continue, but
we're moving in the right direction."
Resource stocks defied the trend because they had been underperforming over recent weeks and were buoyed by news from China's manufacturing sector, Mr Piotrowski said.
Rio Tinto advanced $1, or 1.5 per cent, to $66.63 and BHP Billiton closed up 32?, or 0.9 per cent, at $37.17.
The big four banks all slipped. Commonwealth Bank lost 6? to $48.72, ANZ 16? to $21.55, NAB fell 27? to $24.67 and Westpac 16? to $22.
Pacific Brands dropped 3.5?, or 5.6 per cent, to 59.5? after shareholders rejected the remuneration package for the management of the clothing and linen producer.
Surfing brand Billabong International jumped 31?, or 8.6 per cent, to $3.91 after saying it was on track for strong earnings growth this financial year.
ResMed shares slumped 39?, or 13 per cent, to $2.61, making the stock the worst performer among the top 200. The medical equipment maker said exchange rate movements had caused an 11 per cent fall in first-quarter net profit.
The day's best performer was Mirabela Nickel, which jumped 13?, or 9.5 per cent, to $1.50 after the company reported record sales and production of nickel for the third quarter.
Gold was little changed. At the close, the spot
price was up $US1.80 at $US1655.65 an ounce.
National turnover was 1.84 billion shares worth $4.68 billion, with 15 shares rising for every four that fell.
The Bureau of Statistics
is scheduled to release consumer prices index figures for the September quarter today. A lower than expected reading could prompt the Reserve Bank to cut its cash rate.
The dollar moved up almost half a US cent after trading in a tight range in the run-up to the release of the inflation data.
At the 5pm cutoff, it was at $US1.0456, up from $US1.0416 on Monday. Traders said it had been drifting.
Frequently Asked Questions about this Article…
Why did the S&P/ASX 200 slip and close down 0.64% at 4227.9?
Australian shares gave back some of Monday’s gains as investors grew cautious ahead of domestic inflation (CPI) data and a key meeting of European leaders over the euro‑zone debt crisis. That wary sentiment weighed on the S&P/ASX 200, which fell 27.1 points to 4227.9.
How did resource stocks perform and what drove their strength?
Resource stocks bucked the broader decline because they had been underperforming recently and were lifted by positive news from China’s manufacturing sector. For example, Rio Tinto rose $1 to $66.63 and BHP Billiton closed higher at $37.17.
What happened to the big four banks on the market that day?
The major banks slipped on the session. Commonwealth Bank closed at $48.72, ANZ at $21.55, NAB at $24.67 and Westpac at $22 — each recording declines as part of the broader cautious market tone.
Which companies had company‑specific news that moved their shares?
Pacific Brands fell after shareholders rejected the management remuneration package, while Billabong International jumped after saying it is on track for strong earnings growth this financial year — company announcements that influenced their share prices.
Why did ResMed shares slump and how big was the fall?
ResMed shares were the worst performer in the top 200, falling to $2.61 after the company said exchange rate movements led to an 11% fall in first‑quarter net profit — a hit that translated into about a 13% drop in the share price that day.
Who was the day’s best performer and what was the reason?
The top performer was Mirabela Nickel, which jumped to $1.50 after reporting record third‑quarter sales and production of nickel — positive operational results that lifted the stock.
How did gold and the Aussie dollar move during the session?
Gold was little changed, with the spot price up US$1.80 at US$1,655.65 an ounce. The Australian dollar strengthened by almost half a US cent to US$1.0456 from US$1.0416 in the run‑up to the CPI release.
Why are investors watching the upcoming CPI figures and what could they mean for interest rates?
The Bureau of Statistics was due to release September‑quarter consumer price index figures, and a lower‑than‑expected reading could prompt the Reserve Bank to cut its cash rate. Investors watch CPI closely because it influences monetary policy and market direction.
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