Oct 12 Australian shares fell on Wednesday,
dragged down by commodities, amid a sour start to Wall Street's
corporate earnings season and raised bets on a year-end Federal
reserve interest rate hike.
The S&P/ASX 200 index fell as much as 0.84 percent
to 5,433.6 points, the lowest level since Sept. 30.
Wall Street slipped as shares of Alcoa Inc and
Illumina Inc nose-dived after disappointing quarterly
reports, casting a pall over the market.
Australian markets were also affected by a weak Australian
dollar which slumped to a three-week low, as its U.S.
counterpart strengthened on expectations of an interest
rate hike by the Federal Reserve as early as
"Major factor weighing on the market at the moment is that
strong (U.S.) dollar and the impact that it is having on
commodity prices," said Michael McCarthy, chief market
strategist with CMC Markets.
Materials were the biggest drag on the benchmark index,
responsible for nearly half of the index losses.
Global miner BHP Billiton and rival Rio Tinto
shed over 2 percent each. BHP spin-off South32
was down about 3 percent, while Fortescue Metals Group
fell 3.6 percent.
Energy stocks fell as much as 1.8 percent to post
their biggest intra-day percentage loss in nearly a month as oil
prices retreated from one-year highs on Tuesday, after OPEC said
it was trying to reach a global agreement to cap production for
at least six months.
Oil major Woodside Petroleum Ltd fell 1.5 percent,
while Santos Ltd fell 2.3 percent.
"Clearly the industrial metals group has been tracking oil
reasonably closely over the last few months and that fall in oil
prices overnight has also weighed on the base metals," McCarthy
Bucking the trend, shares of gambling entertainment group
Tabcorp Holdings Ltd, rose 2.8 percent, after the
Australian state of New South Wales (NSW) reversed a ban on
greyhound racing that was due to start next July.
New Zealand's benchmark S&P/NZX 50 index snapped
prior day gains and inched down 0.24 percent or 16.8 points, to
7,107.47, the lowest since July 19.
The New Zealand dollar skidded to 2-1/2 month lows on
Tuesday, a second day of weakness, after the country's central
bank bluntly warned that further policy easing would be needed
to push inflation higher.
Declining issues outpaced advancers on the New Zealand
exchange by a 1.8-to-1 ratio.
Materials and telecommunications accounted for nearly half
of the losses on the benchmark.
Fletcher Building Ltd was the biggest percentage
loser, declining 1.2 percent.
Telecommunication service providers Spark New Zealand
and Chorus Ltd also dragged the index lower,
falling 0.6 percent and 0.3 percent respectively.
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(Reporting by Justin George Varghese; Additional Reporting by
Shashwat Pradhan in Bengaluru; Editing by Eric Meijer)