Australian shares closed 1.5 percent weaker on Friday as investors stayed on the sidelines ahead of the release of key US jobs data which some fear may provide a new signal that the American economy is headed for a recession. Miners and the major banks led the market weaker as Wall Street's four-day rally ended overnight.
Brokers said an article in the New York Times reporting that the US government is set to file law suits against big banks for misrepresenting the quality of mortgage securities during the global credit crisis also undermined sentiment. The benchmark S&P/ASX 200 index ended down 29 points at 4,242.0, according to the latest data. It rose 0.3 percent on Thursday.
New Zealand's benchmark NZX 50 index fell 0.9 percent to 3,303.219. Some brokers predicted the Australian market could rise if Prime Minister Julia Gillard stepped down amid leadership speculation in the local media on Friday. Gillard denied she would step down. Global miners BHP Billiton and Rio Tinto fell on softer commodity prices overnight, closing down 2 percent and 1.4 percent respectively. The big four banks also fell, ANZ bank fell 1.7 percent to close at A$19.92, Commonwealth Bank fell 1.2 percent to A$47.52, National Australia Bank was down 1.4 percent to A$23.51 and Westpac was down 1.0 percent to A$20.51. Building product manufacturer CSR Ltd fell 3.6 percent to A$2.38.