Close Shares fell about 1 per cent today, following weak overseas leads and as the unclear election result continued to weigh on the market.
At the close, the benchmark S&P/ASX200 index was down 47.7 points, or 1.1 per cent, at 4381.3, while the broader All Ordinaries fell 42.1 points, or 0.9 per cent, to 4418.4.
Among the major sectors, materials shed 1.3 per cent, financials fell 1.1 per cent and energy shares dropped 0.9 per cent. Telecoms clawed back some of yesterday's hefty losses, gaining 0.8 per cent.
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CMC Markets head of trading James Foulsham said the market was ‘‘in limbo’’ as negotiations continued between independent members of parliament and the major political parties to secure an election outcome.
‘‘We haven’t seen the momentum that was hoped for in some of the mining stocks based on the fact that the mining tax is potentially going to get abolished,’’ he said. ‘‘I think everyone was hoping for a bit more of a kick than we’ve had out of that.’’
Overnight, the Dow Jones Industrial Average was up as much as 91 points in early trading but turned mixed for much of the day. A slump in the final half-hour of trading amid lingering worries about the US economy left the Dow with a loss of 39 points.
And Japan's Nikkei average hit a 15-month closing low below 9000 points today, with hedge funds and foreigners selling amid mounting concern about the authorities' inaction on a strong yen, which threatens a fragile economic recovery.
That all comes in the midst of profit reporting. Out this morning are results from Origin Energy, Foster's Group, Seek, GPT Group, Macquarie Radio, Oil Search, Charter Hall, Flight Centre, Perpetual, Aevum, Mirvac, AWE, Whitehaven, Macarthur, Firstfolio, Kagara and Aristocrat. For full coverage of this season's earnings, click here.
BHP falls ahead of result
BHP Billiton was sold off ahead of its annual profit announcement on Wednesday, closing down 57 cents, or 1.5 per cent, at $37.54.
Speculation surrounding BHP Billiton’s $US40 billion ($45 billion) bid for Potash Corp of Saskatchewan weighed on the mining stock.
Reports also emerged that rival Rio Tinto is considering a competing bid for the Canadian fertiliser company.
‘‘I think BHP has been hurt a bit because it may not be as easy for them to get it as they initially expected,’’ Mr Foulsham said.
Rio Tinto shares lost $1.13, or 1.6 per cent, to $71.07.
Mr Foulsham said there was still concern in the market about whether a global double-dip recession would eventuate and if strong company earnings could be maintained over the long term.
‘‘People see stocks like Perpetual and the banks as fairly priced at the moment, with not much upside but not much downside either.’’
Another Westpac sell-off
Major lenders lost ground, with Westpac experiencing a second sell-off in as many days after investors digested its third quarter earnings results yesterday. Westpac shares closed 64 cents, or 2.9 per cent, lower at $21.43, National Australia Bank fell 44 cents, or 1.86 per cent, to $23.19, ANZ Banking Group lost 31 cents, or 1.35 per cent, to $22.64 and Commonwealth Bank backtracked 25 cents, or 0.5 per cent, to $49.45.
Funds manager Perpetual eased 13 cents to $30.68 despite doubling its annual profit and dividend, thanks to a stronger equity market in the last 12 months and fatter revenue margings.
Big wealth managers AMP and AXA Asia Pacific Holdings (AXA APH) were two bright spots in a sea of red across the financials sector. AXA APH gained 12 cents, or 2.2 per cent, to $5.47 and AMP gained 2 cents to $4.92.
Oil stocks lost ground in line with the lower global oil prices, with Oil Search slipping 8 cents to $5.79, Woodside Petroleum falling 7 cents to $43.13 and Santos easing 11 cents to $14.03.
Origin Energy stock gave up 29 cents to $15.31 after the company’s underlying annual profit missed expectations.
Major gold stocks were mainly in negative territory as the spot price of gold in Sydney traded at $US1220.70 per fine ounce, down $US6.40 on Monday’s closing price of $US1229.10 per ounce. Lihir Gold finished steady at $4.45 and Newcrest Mining lost 22 cents to $35.73.
Telstra claws back
Telstra recovered from yesterday's fall after going ex-dividend, and added 3 cents to $2.80. Singapore Telecommunications - owner of Optus - gained 4 cents, or 1.7 per cent, to $2.47.
Major media stocks were lower except Consolidated Media, which firmed 4 cents to $3.26 after announcing it would defend court proceedings filed by the special liquidator of One Tel.
Fairfax Media fell 2.5 cents to $1.355, News Corporation lost 11 cents to $15.83 and its non-voting scrip declined 18 cents to $14.10.
In other news, Foster’s Group reported disappointing earnings and its stock fell 27 cents, or 4.3 per cent, to $5.99, after soaring yesterday on the back of takeover talk for its beer division.
Lakes Oil NL was the top traded stock by volume, with 103.9 million shares changing hands for $729,599. Lakes’ shares were steady at 0.7 cents.
Preliminary national turnover reached 2.03 billion shares, worth $5.68 billion, with 394 stocks up, 669 down and 350 unchanged.
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AAP, with BusinessDay