Shares fall as investors await outcome of Fed meeting

The benchmark S&P/ASX 200 index fell 67.9 points, or 1.64 per cent, to 4081.5, while the broader All Ordinaries index fell 65.8 points, or 1.56 per cent, to 4164.1.

The market opened about 1 per cent lower, bucking a positive lead from Wall Street, due to concerns about a decision by European leaders to delay a vote until next month on an ?8 billion ($10.8 billion) bailout loan.

Ian Merrick, an equities consultant at Ord Minnett, said the US lead had been unconvincing, given how much uncertainty surrounded the implications of a Greek default.

He said local trading volumes had been light, with several investors sitting on the sidelines in anticipation of the US Federal Open Market Committee two-day meeting beginning today, in which a stimulus package could be announced. Turnover was 1.74 billion shares changing hands for $3.79 billion.

Losses were reported across all sectors, with about eight of every 10 stocks falling.

The energy sector took the brunt of the downward trend, falling 2.6 per cent as a result of weaker offshore commodity prices.

Woodside Petroleum closed down 85?, or 2.48 per cent, at $33.40 and Santos ended the day 20?, or 1.75 per cent, weaker at $11.25.

Financial stocks were also hit, tainted by investor uncertainty about local banks' exposure to euro zone debt risk.

The big four banks fell, with Commonwealth Bank down 63? at $44.95, Westpac 41? lower at $19.51. ANZ losing 39? to $19.41 and National Australia Bank shedding 42? to $22.44.

Hearing implant manufacturer Cochlear was the best performer on the ASX 100, up 5.7 per cent, or $2.90, at $54.10.

News Corp and Fairfax Media were among the few stocks trading in positive territory. News Corp was up 24?, or 1.5 per cent, at $16.20, and Fairfax rose by 0.5? to81.5?.

Gold stocks gained, with the nation's biggest miner, Newcrest, up 6? at $38.17. The closing price of gold in Sydney was $US1823.70 per fine ounce, up $US57.81.

The worst performing stock on the ASX 100 was surfwear company Billabong, which dived 7.6 per cent to $3.03 after going ex-dividend.