Australian shares rise

Australian shares sea-sawed before finishing higher on Monday as hopes of a rate cut on Tuesday eclipsed concerns about the bank sector earnings after the No.2 lender posted a disappointing interim result. Westpac Banking Corp missed forecasts with a flat first-half profit and its dividend grew at its slowest in nearly four years, leading to concerns its rivals will show similar strain when they report over the next week.
The S&P/ASX 200 index fell as much as 0.4 percent before recovering in the afternoon session to end up 13.1 points or, 0.2 percent, at 5827.5. New Zealand's benchmark NZX 50 index fell 0.5 percent or 30.3 points to finish the session at 5767.1. Westpac Banking Corp missed forecasts with a flat first-half profit and its dividend grew at its slowest in nearly four years, leading to concerns its rivals will show similar strain when they report over the next week.
Shares in the A$110 billion lender fell 4 percent, their biggest decline since November, to a two-month low. After following overseas markets higher at the open, the S&P/ASX 200 index was down 20.9 points or 0.4 percent at 5793.5 by 0242 GMT. "The Westpac result has weighed heavily on the market," said IG Markets strategist Stan Shamu. "Everyone's a little bit sceptical about the bank earnings season. People aren't convinced that they can keep growing earnings and grow dividends the way they used to, and perhaps valuations shouldn't be where they are."
Rival Australia and New Zealand Banking Group, which reports interim results on Tuesday, dipped 2.4 percent while Commonwealth Bank of Australia and National Australia Bank both fell more than 1 percent. Energy stocks also fell, after oil price dipped on news Iraq exports hit a record high. Oil Search and Woodside Petroleum dropped 0.7 percent and 0.2 percent. Resources contractor Worley Parsons sank 9 percent after announcing a writdown and 2,000 staff redundancies.
Iron ore miners fared better after the price of the key steel-making ingredient remained off their record lows. BHP Billiton rose 1.5 percent and Rio Tinto firmed 2 percent. Consumer staples firms also rose amid expectations of a rate cut on Tuesday, with No.1 supermarket operator Woolworths and Wesfarmers, which owns its rival Coles, both up 1.5 percent.
New Zealand's benchmark NZX50 index trimmed early losses to last trade down 0.4 percent at 5,776.9, led by falls in most leading stocks like telecommunications company Spark and power company Contact Energy, both down 1 percent. Insurer Tower was down 1.9 percent as it remained under pressure following last week's guidance that it expected a small first-half loss because of extra Canterbury earthquake claim costs. Accounting software firm Xero rose 1.2 percent while its newly-relisted rival MYOB debuted at a 6 percent premium to its issue price.