Australian shares ended marginally lower on Thursday, dropping 0.07 percent, amid exceptionally light volumes as investors largely sat tight ahead of a key monetary policy announcement from the European Central Bank. Strategists said the day's trade was on par with the quiet Christmas season following the lack of a lead-in from the United States due to the Independence Day holiday.
"Volumes were miniscule, we didn't even break the $3 billion barrier," said Ben Le Brun, market analyst at optionsXpress. "We're very much in wait and see mode." The benchmark S&P/ASX 200 index fell 2.96 points to 4,169.2, after trading in a tight range for most of the session. Oil and gas companies were among the leading declines, with Beach Energy Ltd losing 3.9 percent, Linc Energy Ltd dropping 4.5 percent and Woodside Petroleum Ltd shedding 0.7 percent.
Big miners were all lower with BHP Billiton down about 0.2 percent and Rio Tinto shedding 0.5 percent as worries about Europe continue to weigh on commodities prices. New Zealand's benchmark NZX 50 index gained 1.08 points, or 0.03 percent, to 3,484.2. Analysts are waiting to see if the European Central Bank delivers a shot of stimulus for Europe's sluggish economy with a rate cut or possibly other measures.
"There is only one story at the moment and that is whether the ECB believe the time is right to provide a stimulatory shot to support perceived recent developments by the EU leaders," said Andrew Taylor, market strategist with GFT. "The ECB's actions will be a clear insight into whether the board members also buy into the possibilities that the EU leaders are progressing," Taylor added.
Also later in the day, the Bank of England is widely expected to increase its quantitative easing program following its two-day monthly meeting. On the home front, there was little reaction to news Australia's trade deficit widened in May to A$285 million.
Trading in Fairfax Media did cause a stir at the end of the day when mining magnate Gina Rinehart sold a $50 million stake, bringing her holding down to about 15 percent, after failing to win a seat on the company's board. Fairfax shares rose 0.9 percent to 58.5 Australian cents.