Trading Room home page

Aust shares close lower

Market watch top headlines

Australian reports

World reports

Stocks to watch

AZJ, AZZ, BHP, QAN, SGM,

AAP

2012-11-12

Australian shares have closed lower, dragged down by weakness in the mining and energy sectors as investors stayed on the sidelines in response to an uncertain US budget outlook.

The benchmark S&P/ASX200 index fell 14.02 points, or 0.31 per cent, to 4,448 points on Monday, while the broader All Ordinaries index declined 12.56 points, or 0.28 per cent, to 4,469.9 points.

On the ASX 24, the December share price index futures contract was 27 points lower at 4,457 points, on volume of 26,601 contracts.

The Australian share market opened down about 0.4 per cent as market players fretted over the looming US budget deadline over a series of tax measures and government spending cuts due to hit in early calendar 2013.

The measures - dubbed the fiscal cliff - are expected to act as a big drag on US economic growth and have a significant knock-on impact on the global economy, should they come into effect.

CMC Markets senior trader Tim Waterer said conjecture surrounding the US fiscal cliff kept positive sentiment in check.

"Investors remain consumed by US fiscal cliff consequences," Mr Waterer said in a research note.

Among the big miners BHP Billiton lost 16 cents to $34.30, while Rio Tinto fell five cents to $58.64.

The worst-performing sector on the market was energy stocks, which tumbled 1.07 per cent according to IRESS data.

Gold stocks (down 0.67 per cent) and industrials (down 0.65 per cent) also had a negative day.

The materials sector, a big part of the market, ended 0.61 per cent weaker.

Making news on Monday, insurance giant QBE said it expected its losses up to $US450 million ($A434.85 million) from super storm Sandy in the United States.

QBE shares dived $1.07, or 8.31 per cent, to $11.80.

In percentage terms QBE was the worst-performing stock on the S&P/ASX50.

"This latest downgrade is going to dent confidence in QBE," IG Markets strategist Stan Shamu said in a research note.

"This is not the first time QBE has issued a significant downgrade and investors will grow increasingly wary of insurers after a bad run."

Chemicals manufacturer Orica said net profit for fiscal 2012 fell 37 per cent to $402.8 million, after a previously announced $247 million impairment on its specialty bolts and chemicals business Minova.

Orica fell 99 cents, or 3.96 per cent, to $24.01.

The big four retail banks finished mixed.

ANZ ended down 11.5 cents at $24.45 and National Australia finished 17 cents weaker at $23.64, while Westpac added 18 cents to $25.35 and CBA put on 58 cents to $59.40.

The spot price of gold in Sydney closed at $US1,735.46 per fine ounce, down $US1.56 from Friday's local close of $US1,737.02 per ounce.

National turnover was 1.46 billion securities worth $3.99 billion, with 394 stocks up, 510 down and 400 unchanged.

Jordan Chong