Australian stocks fell 1.2 percent on Monday, led lower by banks and miners after Standard & Poor's cut the debt ratings of nine of the eurozone's 17 countries including France, aggravating debt funding problems in the eurozone. "Investors seem to be exercising caution ahead of the European session, as the region is yet to react to news of the downgrade," said IG Markets strategist Stan Shamu.
With US markets closed on Monday for a holiday, investors were also nervous ahead of US corporate earnings reports due later in the week, he said. A rare bright spot was top contractor Leighton Holdings after lifting its profit guidance. The shares closed up 4.4 percent at A$21.44 after Leighton said it now expects an underlying profit after tax of around A$270 million ($277.68 million), up from guidance of around A$250 million, for the six months to December.
Miners were weaker after a newspaper reported that the Greens, which hold the balance of power in the Australian Senate, want the Labour government to revise the planned profit tax on large iron ore and coal mines. BHP Billiton lost 1.7 percent to A$35.98 and iron ore producer Fortescue lost 2.7 percent to A$4.62. The benchmark S&P/ASX 200 index closed down 48.7 points at 4,147.2. The benchmark rose 14.9 points on Friday to end the week 2.1 percent higher.
New Zealand's benchmark NZX 50 index slipped 0.5 percent to 3,210.6. Shares in Linc Energy fell 3.4 percent to A$1.285, after surging 17 percent on Friday. The company said it was in discussions with a potential cornerstone investor to develop opportunities in China.
Shares in poker machine maker Aristocrat fell 2.7 percent to A$2.50 as talks continued between the government and independent MPs on poker machine reforms, including introducing pre-set limits. Casino owners Echo Entertainment fell 1.1 percent and Crown Entertainment lost 1.9 percent. Real estate firm FKP stapled securities jumped 10.7 percent to A$0.62 after an unsourced report in the Australian Financial Review said talks were continuing with a Chinese suitor for FKP's A$1 billion retirement villages portfolio.
Comments
Comments are closed.