Market falls as US stimulus hope fades

Trading divided along risky and defensive lines yesterday, with utilities, resources and energy stocks slipping backwards, while health care and telecommunications stocks performed well.

Resource stocks suffered some of the steepest falls - BHP Billiton lost 33?, or 1 per cent, to $32.62, and Rio Tinto slipped $1.42?, or 2.5 per cent, to $55.10 - on news that the eurozone economy had contracted again, raising fears for global growth.

The S&P/ASX 200 Index finished down 11 points, or 0.3 per cent, at 4281.2.

Analysts said that investors were concerned yesterday after US retail sales figures, which were released on Tuesday night, rose for the first time in four months in July, while the pace of inventories growth slowed further in June.

The news dampened hopes that the US Federal Reserve would attempt to breathe life into the economy with a third-round of stimulus measures - normally a boon for equities markets.

Contributing to the sombre mood, investors absorbed news that the eurozone economy had contracted by 0.2 per cent in the June quarter, shrinking by 0.4 per cent from a year earlier.

On the Australian scene, the Westpac-Melbourne Institute's consumer confidence survey showed an unexpected 2.5 per cent fall this month.

The institute's results contrasted with the latest Roy Morgan consumer confidence survey, which last week was up at 113.1 points, its highest in three months.

As the reporting season rolls on, shares in National Australia Bank, Westpac and ANZ all fell. NAB lost 44?, or 1.8 per cent, to $24.26, Westpac was down 2?, at $23.68, and ANZ lost 13?, or 0.5 per cent, to $23.63.

Only Commonwealth Bank bucked the trend, climbing 51?, or 0.9 per cent, to $56.05 after posting a record $7.09 billion full-year profit.

Shares in medical centres operator and pathology provider Primary Health Care jumped 12 per cent to $3.46, after it reported a 49 per cent increase in net profit.