Australian shares trimmed their losses after the RBA raised rates, although banks weighed on the market, dragging it to six-week low. Melbourne Cup Day contributed to lower stock volumes.
The benchmark S&P/ASX200 index ended the day down 8.9 points, or 0.2 per cent, at 4531.5, while the broader All Ordinaries fell 6.3 points, or 0.1 per cent to 4540. The ASX200's close is the lowest since September 14.
Among the sub-indexes, materials were up 0.4 per cent, energy shares were 0.5 per cent lower, while financials lost 0.5 per cent.
What you need to know
The Australian dollar was buying 90.18 US cents
Asian stocks were little changed in fluctuating trade
Oil was trading at $US78.29 a barrel
Gold was changing hands at $US1063 an ounce
Dow futures were up 14 at 9749.
Cameron Securities client adviser Adrian Leppinus said it had been a quiet trading day because of the Melbourne Cup, with QBE a notable mover.
Market turnover was 1.55 billion shares worth $3.12 billion, the lowest trading value in a month.
''QBE slumped on the report that the dollar's hurting them and that they won't do as well as previously thought,'' Mr Leppinus said.
''We had broker reports today trimming their target prices and earnings.''
QBE slumped 86 cents, or 3.88 per cent, to $21.29, the biggest loser among the S&P/ASX 50.
The insurer said on Monday that it had cut back its projected insurance revenue growth because the stronger Australian dollar hit its overseas takings.
The major banks were mostly weaker.
Westpac, which will announce its full-year earnings on Wednesday, fell 16 cents, or 0.63 per cent, to $25.43 and National Australia Bank declined 51 cents, or 1.76 per cent, to $$28.39.
ANZ was little changed, losing one cent to $22.58 and Commonwealth Bank gained 37 cents to $51.28.
Other stocks that weighed on the market included Westfield, which fell 22 cents to $12.12, Wesfarmers, which declined 28 cents to $26.92 and Woodside Petroleum lost 54 cents to $47.70.
Mr Leppinus said the major gainers of the day had been the gold stocks, including Lihir Gold and Newcrest.
''Gold price been holding in there,'' he said.
''Lihir and Newcrest...they're the winners today.''
Newcrest gained $1.26, or 3.92 per cent, to $33.38, Lihir Gold rose 13 cents, or 4.28 per cent, to $3.17 and Sino Gold added 15 cents, or 2.29 per cent, to $6.70.
At 1624 AEDT, the spot price of gold in Sydney was $US1,063 per fine ounce, up $US16.67 on Monday's closing price of $US1,046.33.
Macmahon and Leighton were both among the gainers after the companies agreed to extend a memorandum of understanding with over partnering on large infrastructure projects.
Macmahon jumped 4.5 cents, or 8.41 per cent, to 58 cents, while Leighton rose 50 cents, or 1.46 per cent, to $34.85.
Other gainers on the day included GPT, which rose 2.5 cents to 61 cents and Computershare, which gained 24 cents to $10.62.
In other company news, Drilling services provider Boart Longyear slashed its net debt after completing a $US700 million ($771.4 million) capital raising.
Boart added half a cent to 28 cents.
Lend Lease received the green light from an independent expert to take up the remaining stake it doesn't already own in aged care group Lend Lease Primelife Group.
Lend Lease fell 11 cents to $9.11 and Primelife was steady at 30 cents.
Shares in Myer Holdings gained after falling 8.5 per cent following its listing yesterday, with institutions and long-term investors expected to provide further short-term support.
Myer added six cents to $3.84 as $115 million worth of shares changed hands.
Weapons developer Metal Storm called a trading halt as it waited for a delayed payment from a foreign investor.
Metal Storm last traded at 3.1 cents.
The most-traded stock by volume was Capral, with 93.5 million shares changing hands worth $3.95 million.
Shares in the aluminium products supplier jumped 1.3 cents, or 39 per cent, to 4.6 cents.
On the market as a whole, 566 stocks rose, 444 fell and 330 were steady.
On the Sydney Futures Exchange at 1613 AEDT, the December share price index contract was down 23 points at 4,520 on a volume of 28,409 contracts.