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Australia shares inch up, but cautious on U.S. deadlock
October 7, 2013 / 1:12 AM / 4 years ago

Australia shares inch up, but cautious on U.S. deadlock

SYDNEY, Oct 7 (Reuters) - Australian shares inched up 0.1
percent on Monday morning as  investors remained wary of the
consequences of a prolonged U.S. budget and debt battle, with
activity thinned by a holiday in the financial capital of
    Equity markets have been under pressure since the U.S.
federal government shutdown began on Tuesday, and that is
expected to only increase as the Oct. 17 deadline to raise the
federal borrowing limit gets closer. 
    "We are not encouraging people to jump in front of the
agreement. If they don't get an agreement, the ramifications are
very negative, and if they do get an agreement, it's relatively
a neutral outcome for the market," said Andrew Quin, research
strategy coordinator at Patersons Securities.
    "Like most other people, we expect a last-minute decision,
and we don't see why we really want to trade heavily into it,"
he said.
    The S&P/ASX 200 index added 3.7 points to 5,211.7 by
0029 GMT. The benchmark fell 0.5 percent on Friday, and has held
above the 5,200 mark for about one month.
    Blue-chip miners mostly traded lower, with BHP Billiton Ltd
 losing 0.3 percent. Rio Tinto Ltd edged up 0.2
    BHP shares have fallen more than 5 percent this year and
Rio's are down more than 8 percent, hurt by weak metals prices
and fears about slowing growth in China, Australia's top export
market. The broader index is up 12 percent for the year.
    Newcrest Mining Ltd, Australia's biggest listed
gold miner, dropped 1.2 percent after gold prices slipped.
    Banking stocks pulled back, except for Australia and New
Zealand Banking Group Ltd, which was up 0.4 percent
after the redemption of $750 million of trust securities.
    Top lender Commonwealth Bank of Australia fell 0.9
percent, and National Australia Bank lost 0.4 percent.
    Leighton Holdings Ltd, Australia's biggest
construction group, gained 3.4 percent after being sold off
heavily last week on media reports that corruption and bribery
were widespread at the company. 
    "The company is probably talking to investors now and
fielding calls and so forth, perhaps giving them some
positives," said Akshay Chopra, an investment analyst at Karara
    Leighton said an Australian court had issued a writ alleging
it breached continuous disclosure obligations in relation to
corruption allegations, and said it would defend the class
    Blood products maker CSL Ltd slipped 0.3 percent
after reaching an agreement to settle antitrust class action
litigation in the United States, which could reduce its fiscal
2014 earnings. 
    Discovery Metals dropped 1.4 percent, as 
Singapore's Blumont Group said its share price slump
would not affect its plan to invest $108 million in the copper
    New Zealand's benchmark NZX 50 index rose 0.2
percent to 4,767.1.  

 (Reporting By Maggie Lu Yueyang; Editing by John Mair)

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