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Australia shares dragged lower by banks; NZ down a 3rd straight day
August 28, 2017 / 6:59 AM / 3 months ago

Australia shares dragged lower by banks; NZ down a 3rd straight day

(Updates to close)

Aug 28 (Reuters) - Australian shares slipped on Monday, with the financial sector leading broad-based losses after a financial regulator said it would establish an inquiry into Commonwealth Bank of Australia (CBA).

The S&P/ASX 200 index dropped 0.6 percent, or 33.961 points at 5,709.9. on Monday, the benchmark was marginally lower on Friday.

The financial index fell 0.9 percent to its lowest in two months as Australia’s four biggest banks lost between 0.5 percent and 1.8 percent. CBA slid 1.3 percent.

Sentiment in the sector turned sour after Australian Prudential Regulation Authority (APRA) said on Monday it would establish an inquiry into CBA following the bank’s alleged breaches of money-laundering and counter-terrorism finance rules.

Material stocks ended lower on the back of weak metal prices, as iron ore and coking coal were on track for their biggest one-day fall in about three months.

Miner Rio Tinto Ltd ended 1.2 percent down while BHP shares were 0.8 percent higher on support from oil prices.

Brent futures were pushed up by pipeline blockades in Libya, while gasoline prices hit two-year highs as floods caused by Hurricane Harvey forced refineries across the U.S. Gulf Coast to shut.

Energy stocks ended higher with Santos Ltd up 2.2 percent and Woodside Petroleum up 0.5 percent. Transport fuel supplier Caltex Australia Ltd gained 1.7 percent.

New Zealand’s benchmark S&P/NZX 50 index fell for a third straight day, shedding 0.4 percent, or 30.94 points to 7,826.87.

The index was pulled down by telecom and consumer staple stocks.

A2 Milk Company Ltd, down 2.8 percent while communications services firm Chorus Ltd, off 5.6 percent, were the biggest drags on the index.

Chorus fell after its full-year profit after tax of NZ$113 million ($81.8 million) missed analysts’ estimates. (Reporting by Nicole Pinto; Editing by Richard Borsuk)

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