Australian shares fell 1.0 percent on Tuesday, with the financial sector hardest hit as political uncertainty at home after an inconclusive election hurt sentiment, while New Zealand's bourse rose on an uptick in business confidence. The S&P/ASX 200 index fell 53.78 points to 5228 at the close of trade. The drop wiped out Monday's 0.67 percent gains, which were driven by industrial and precious metals miners.
New Zealand's benchmark S&P/NZX 50 index picked up 0.43 percent, or 30.04 points, to finish the session at 6970.99. "The selling is broad based, with only the materials sector in the green on the back of stronger iron ore prices and continued interest in gold plays," said Chris Conway, Head of Research at Australian Stock Report. "With vote counting resuming today regarding the Federal election, that's another risk that has been brought to the fore and traders and investors are simply booking some gains.
"We had nothing in the way of positive leads this morning and with US markets closed (on Monday), it gave little direction." Financials led the index lower, ahead of a central bank meeting later on Tuesday where rates are expected to be held at all-time lows. Stock prices for all four major banks edged lower. Commonwealth Bank of Australia was down 1.06 percent, Westpac Banking Corp fell 1.35 percent, National Australia Bank Ltd lost 1.76 percent and Australia and New Zealand Banking Group Ltd was 1.43 percent lower.
Wesfarmers Ltd shares tracked 1.5 percent lower and resources stocks reversed early gains, with BHP Billiton falling 0.31 percent and Fortescue Metals Group dropping 1.41 percent, even as iron ore prices rallied. Stocks in mining junior Western Areas Ltd surged 5.65 percent on higher nickel prices. Whitehaven Coal Ltd rose 5.56 percent and mining services operator Worley Parsons Ltd climbed 2.4 percent. Sentiment got a lift after New Zealand business confidence rebounded in the second quarter, a private think tank said on Tuesday. The biggest gainers were Meridian Energy, which rose 2.5 percent and Skellerup, which rose 1.6 percent. The biggest losers included Genesis Energy, down 1.6 percent.
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