Stocks dip as profit-reporting season looms
THE sharemarket ended lower yesterday as investors took profits in the run-up to the February profit reporting season.
THE sharemarket ended lower yesterday as investors took profits in the run-up to the February profit reporting season.The market opened slightly stronger in defiance of a weaker Wall Street at the weekend but weaker consumer staples and bank stocks helped to pull it back.At the close, the S&P/ASX 200 Index was down15.7 points, or 0.4 per cent, at 4272.7.Among worst-performing sectors was consumer staples, which lost 0.7 per cent, with investors wary of possible earnings downgrades this week.City Index chief market analyst Peter Esho said he expected Woolworths' second-quarter sales results to come in below market expectations."The expectation is for a2 to 6 per cent rise but I think that's a bit high," he said. "I think there's the possibility the earnings guidance could be reduced."Woolworths ended at a two-month low at $24.45, down 32?.Wesfarmers shed 16? to $30.17. The company is due to report on second-quarter supermarket sales data from its Coles division on Thursday.Bell Direct equities analyst Julia Lee said she expected the retailers to underperform the general market because of competition from offshore websites that had benefited from the stronger dollar."This week is about consumer staples and next week will be about the financials," he said.The financial sector lost 0.5 per cent, with the big banks down between 0.1 per cent and 0.9 per cent.Treasurer Wayne Swan said yesterday he would continue to put pressure on lenders to cut their interest rates in line with any reduction in the Reserve Bank's official cash rate despite concerns about rising funding costs among the banks. NAB fell 17? to $23.91, ANZ was down 3? at $21.47, Commonwealth was off 12? at $51.04 and Westpac lost 19?to $21.10.Among the miners, BHP Billiton firmed 1? to $37.67 and Rio Tinto was down 78? at $69.Leighton Holdings was down 28? at $23.45 even though subsidiary Thiess and a Belgian company have jointly won a $260 million contract to help develop a port in northern Western Australia.Transurban shares lost 7? to $5.50 after the toll road operator's chief executive, Chris Lynch, announced he would resign in July.Ten Network was up 0.5? at 89.5? after reports that Seven Group chairman Kerry Stokes had sold his 2 per cent stake in the broadcaster.Spot gold was up $US11.11 at $US1730.26 an ounce.