Australian shares lost 0.3 percent on Monday, dragged down by financials as a government-led inquiry into the scandal-hit banking sector's selling tactics got underway. The benchmark S&P/ASX 200 index recovered some losses to finish the session 0.3 percent or 17.3 points lower at 5,820.7 - its weakest close since October 13. It slipped 0.9 percent on Friday.
Investors are also watching out for US January inflation data due later in the week as it comes amid a backdrop of growing anxiety in markets which have been roiled by the prospect of higher prices and interest rates. On Wall Street, the S&P 500 Index recorded its worst week in two years.
In Sydney, the market was pinned down by the 'Big Four' banks, falling between 0.5 to 0.8 percent. Westpac Banking Corp and Australia and New Zealand Banking Group declined 0.7 percent each for their weakest close since June 2017. The losses came as a government-backed inquiry into Australia's finance sector on Monday said it will start its year-long investigation by scrutinising the selling tactics of banks' most lucrative products - mortgages.
Electronics retailer JB Hi-Fi was the biggest loser on the index with an 8 percent drop. The company posted a record first-half profit, but warned that earnings growth would slow amid fierce competition. Mining stocks helped cushion the index's fall, supported by a recovery in oil and copper prices.
BHP Billiton and Rio Tinto rose 1.5 percent each, while South32 Ltd climbed 2.7 percent. New Zealand's benchmark S&P/NZX 50 index fell 0.4 percent or 33.31 points to finish the session at 8,059.06, its lowest close since mid-November.