Close The Australian sharemarket suffered big losses today in widespread profit-taking after recent gains, although the market still locked in a 4.1 per cent gain for September.
At the close, the benchmark S&P/ASX200 index was down 62.1 points for the day, or 1.3 per cent, to 4582.9, while the broader All Ordinaries index fell 57.1 points, or 1.2 per cent, to 4636.9.
All sectors posted losses, but the finance sector was the biggest drag on the market, losing 1.7 per cent. Materials were down 1 per cent and energy shares fell 1.1 per cent.
need2know:
- European stocks drop at the open
- Nikkei drops 2%, still posts 6% monthly gain
- The dollar slips below 97 US cents
- Gold steady at $US1307, near record
- Dow futures are down 39 points to 10,741
Data out today showed building approvals dropped 4.7 per cent in August, far weaker than expectations for a flat outcome, suggesting higher interest rates were hurting demand for new homes and the buoyant construction sector could slow next year.
Private sector credit data also missed expectations, rising only 0.1 per cent in August.
"The data suggests that the domestic economic recovery may not be as robust as previously thought. The housing sector certainly looks like it is slowing, with house prices down for a third straight month," said Savanth Sebastian, economist at CommSec, noting business credit was down 4 percent on a year ago.
"The domestic economy is not out of the woods yet. Until the conservative mood of Australians changes, the economy will remain patchy," he said
On the currency front, the Australian dollar was recently trading just below 97 US cents after touching a two-year high of 97.3 US cents in overnight trade, and hitting parity with the Canadian dollar for the first time since 2004.
Running out of puff
Austock senior client adviser Michael Heffernan said the local market had put in a disappointing performance today, with ‘‘an absence of any major economic or corporate news’’.
‘‘It (the market) is running out of puff, frankly. It is the last day of the month and the quarter....there’s a bit of profit-taking but nothing that I can discern that is a major negative,’’ Mr Heffernan said.
The major banks led the retreat, despite the Reserve Bank giving a clean bill of health to banks and households, suggesting financial conditions were no barrier to raising interest rates.
Mr Heffernan said investors may be waiting for the major banks to report their financial results in the next few weeks.
Among the major banks, National Australia Bank was 56 cents lower at $25.34, Westpac dumped 47 cents to $23.24, ANZ retreated 46 cents to $23.68, and Commonwealth Bank slumped 88 cents to $51.17.
Telstra hits new low
Among other stocks, Telstra fell 6 cents to a new all-time low of $2.62 as it said it has not confirmed how many jobs will be cut under its plan to simplify its business.
In the resources sector, global miner BHP Billiton shed 46 cents at $38.91, and Rio Tinto sagged 49 cents at $76.77.
Securities in coal explorer Coalspur Mines were in a trading halt ahead of a capital raising. Coalspur last traded at 92.5 cents.
Cougar Energy was 0.3 cents higher at 4 cents as it said it was holding talks to form an alliance to develop underground coal gasification projects.
Australia’s biggest gold miner, Newcrest Mining, descended 33 cents to $39.67 as it signed an agreement which includes the possibility of taking a majority interest in an exploration joint venture in Papua New Guinea.
Property developer Stockland scraped off 1 cent to $3.84 as it took a majority stake in takeover target Aevum after a two-month battle for control of the largest retirement village owner in NSW. Aevum was steady at $1.77.
Office equipment financing firm ThinkSmart hovered at 65.5 cents as it said it aims to raise about $16 million via the issue of shares and is substantially increasing its debt facilities to fund growth plans.
More impetus needed
The 4700-level proved too difficult to tackle this month, with investors still made uneasy by an uncertain macroeconomic back drop.
"We probably need additional impetus to push through. Whether that's earnings upgrades or M&A activity, we're going to need something extra to push through those levels," said Tim Shroeders, portfolio manager at Pengana Capital.
For the quarter, the index notched up a 6.5 per cent gain, compared with a leap of 19.9 per cent in the same quarter a year earlier.
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AAP, Reuters, with BusinessDay