Market drifts lower as investors stay on sidelines
THE sharemarket closed half a per cent weaker yesterday amid renewed worries about European debt.
THE sharemarket closed half a per cent weaker yesterday amid renewed worries about European debt.The benchmark S&P/ASX200 index fell 19 points, or 0.44 per cent, to 4285.6, while the broader All Ordinaries index was down 17.6 points, or 0.4 per cent, at 4351.5. The December share price index futures contract was 28 points lower at 4299.The RBS Morgans director of equities, Bill Chatterton, said the local market performed marginally better than US stocks, which fell in overnight trading. But concerns over Italy's borrowing costs continued to weigh on the local market."Overall, the instability of Europe is still a concern and how it plays out is hard to know," Mr Chatterton said. "A new leader in Italy adds a bit more substance."Among the major stocks, the mining giant BHP Billiton fell 62?, or 1.65 per cent, to $36.88.Commonwealth Bank slipped 1.42 per cent, or 71?, to $49.15 despite saying cash earnings for the first three months of the financial year were about $1.75 billion, putting it on track to equal or better last year's record profit.The other big banks were largely unchanged, with National Australia Bank edging 4? lower to $24.52, Westpac up 4? at $21.09 and ANZ also 4? higher at $20.70.Retail stocks took a knock, with JB Hi-Fi ending 32?, or 1.95 per cent, weaker at $16.10, while Westfield shares were 20? lower at $8.05.Ramsay Health Care was down 37? at $19.42 after it said Europe's financial turmoil could inflict some pain on its private hospital business on the continent, but the company remains committed to its expansion there.The federal government's move to lift a ban on uranium sales to India boosted uranium stocks but share prices are still well below the levels before the Fukushima nuclear crisis.Paladin, which operates the Langer Heinrich mine in Namibia, was up 5.5? at $1.66 but its share price is still 65 per cent below the $4.83 it fetched on March 10. Fellow uranium explorer Toro Energy was up 1?, or 10 per cent, at 8.5?, and Extract Resources was up 13? at $7.87, still well below its March 10 closing price of $10.50.Wall Street was weaker as investors noted the Italian government's high cost of borrowing funds on global markets. An auction of Italian government five-year bonds went at a yield of 6.29 per cent, the highest rate since since 1997.