Australian shares fell for the first time in four sessions on Monday as mining and energy companies were hurt by weaker metals and oil prices, while New Zealand shares hit another record high propelled by yield-hungry investors. The S&P/ASX 200 index fell 16.52 points to 5166.60 at the close of trade. The benchmark was down 0.32 percent from Friday's close.
New Zealand's benchmark S&P/NZX 50 index edged up 0.28 percent or 18.44 points to finish the session at 6641.94, after having touched an all-time high of 6649.61 during the session.
Investors are shifting funds out of bank deposits and into shares in search of higher returns as interest rates have been cut to record lows, said Grant Williamson, a broker at Hamilton Hindin Greene.
"I think we'll find that will continue for a while, because as term deposits mature people are looking to see what alternatives there are, given what the banks are offering is pretty low," Williamson said. Logistics group Mainfreight and insurer Tower led the market up. "We're going to be range-bound for the entire calendar year," predicted Don Williams, chief investment officer at Platypus Asset Management.
He said there was little to drive the market higher as share price valuations were factoring in higher earnings growth than was achievable this year. "The best of the earnings growth has been seen, and it's just going to be a tougher year this year," Williams said. Three of the big four banks dropped more than 1 percent, while Westpac Banking Corp fell 0.4 percent. The top two miners, BHP Billiton and Rio Tinto, both fell around 1 percent.
Energy stocks were among the biggest losers, with AWE Ltd and Beach Energy both off about 5 percent. Virgin Australia jumped 9.3 percent to A$0.38 after securing a A$425 million ($323 million) loan facility from its four major shareholders: Air New Zealand, Etihad Airways, Singapore Airlines and Virgin Group, giving it breathing room to review its capital structure.
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