Third day of falls as cash rate holds steady
The benchmark S&P/ASX 200 Index lost 23.4 points, or 0.4 per cent, to 5256.1, while the broader All Ords slipped 23.9 points, or 0.5 per cent, to 5249.6.
"We expect a broad global economic recovery to prompt scares about tightening monetary policy in early 2014, that will cause volatility in equity markets globally while supporting commodity prices," AMP Capital head of dynamic asset allocation Nader Naeimi said. "Globally, equities have had a strong year in 2013 and are likely to see a correction in early 2014, but Australian equities are particularly vulnerable because local company earnings growth has not been as strong as in competing markets."
The banks and miners all dragged the market lower as Bureau of Statistics figures showed the current account deficit rose to $12.7 billion in the September quarter, up 5 per cent from the previous quarter but defying expectations of a fall to $11 billion.
The dollar was buying US90.68¢, down from US91.48¢ at Monday's close.
Metals and mining was the worst-performing sector, down 1.4 per cent. The two biggest miners fell despite the spot price of iron ore edging higher.
Heavyweight BHP Billiton lost 1.2 per cent to $36.45. Rio Tinto shed 0.6 per cent to $65.49, despite showing a $US1.8 billion improvement in operating cash costs in the 10 months to October and management saying the company is on track to reach its target to reduce costs by $US2 billion in 2013.
Whitehaven Coal was the best-performing stock, up 6.5 per cent to $1.73.
Industrial rail operator Aurizon added 1.7 per cent to $4.75, as the Queensland government cut its stake to below 5 per cent after selling $350 million in shares to pay down the state's debt.
AGL Energy dipped 0.1 per cent to $14.97. The Australian Competition and Consumer Commission launched an informal review into its takeover bid for NSW power producer Macquarie Generation.
Gold stocks were smashed again after the spot price fell overnight before ticking back above $US1220 ($1336) an ounce in late trade. Australia's biggest goldminer Newcrest lost 6.7 per cent to $7.25.
Frequently Asked Questions about this Article…
The sharemarket fell for a third session despite the Reserve Bank keeping the cash rate steady at 2.5%. The decline was influenced by the Reserve Bank's ongoing efforts to talk down the value of the dollar and concerns about the global economic recovery potentially leading to tighter monetary policy.
The S&P/ASX 200 Index lost 23.4 points, or 0.4%, dropping to 5256.1. This decline was part of a broader market trend influenced by various economic factors.
The current account deficit rose to $12.7 billion in the September quarter, defying expectations of a fall to $11 billion. This unexpected increase contributed to the downward pressure on the market.
The metals and mining sector was the worst-performing, down 1.4%. Major miners like BHP Billiton and Rio Tinto saw declines despite positive developments in their operations.
The Australian dollar was buying US90.68¢, down from US91.48¢ at the previous close. This decline was part of the broader market movements influenced by economic factors.
Whitehaven Coal was the best-performing stock, rising 6.5% to $1.73, bucking the overall market trend.
Aurizon's shares increased by 1.7% to $4.75 after the Queensland government reduced its stake to below 5% by selling $350 million in shares to pay down state debt.
AGL Energy's shares dipped 0.1% to $14.97 as the Australian Competition and Consumer Commission launched an informal review into its takeover bid for NSW power producer Macquarie Generation.
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