Miners feel pinch on developing markets
The sharemarket finished lower as investor concerns about emerging markets hit resource stocks.
The benchmark S&P/ASX 200 Index was down 34.3 points, or 0.67 per cent, at 5078.2 points. The broader All Ordinaries Index was 33.5 points lower, or 0.66 per cent, at 5068.8 points.
The top 20 developing nation currencies have tumbled against the US dollar, as financial markets expect the US Federal Reserve to taper its mass bond buying stimulus measures from September.
The 0.7 per cent fall in the Australian market on Tuesday occurred as the India rupee hit an all-time low against the greenback and Japan's Nikkei lost 2.6 per cent.
IG markets strategist Chris Weston said a sharp rise in US Treasury bond yields was squeezing demand for assets in developing markets. "It's a story of emerging market weakness, basically," he said. "The move we've seen in the developed market bond market is killing the emerging market trade right now: places like India, Malaysia, Indonesia, Brazil; all their currencies are getting absolutely smashed."
The big resource companies were affected, with BHP Billiton losing 50¢ to $36.54 as Rio Tinto ditched 63¢ to $59.51.
After the local market closed, BHP announced a 29.5 per cent fall in full-year net profit to $US10.9 billion ($12.03 billion).
The big four banks had mixed fortunes, with National Australia Bank gaining 21¢ to $31.57 after posting a $1.7 billion net profit for the three months to June.
ANZ was also up, adding 1¢ at $29.56, but Commonwealth Bank was down 88¢ at $70.27, and Westpac shed 43¢ at $31.14.
Investors appeared to overlook minutes from the Reserve Bank's August meeting, where members agreed the possibility of closing off more rate cuts should be considered.
Meanwhile, QBE Insurance Group shares lost 93¢, or 5.46 per cent, to $16.10 after posting a 37 per cent fall in half-year net profit to $US477 million ($526.29 million), following a fall in demand for US mortgage insurance.
National turnover was 1.7 billion securities worth $4.3 billion.