SYDNEY, Apr 16: Australian shares pared some of their early losses to finish 0.3 percent lower on Tuesday, as miners underperformed following a broad rout in commodities markets the previous session after growth in top export market China stumbled.
Market sentiment was also hurt by the bombing of the Boston Marathon, where three people were killed and more than 100 injured in what a White House official called an ‘act of terror’.
The S&P/ASX 200 index fell 17.1 points to finish at 4,950.8. The market recovered from an intraday low of 4,914 as U.S. Stock futures rose and as gold and other commodities rebounded from a massive selloff overnight. The benchmark fell 0.9 percent on Monday, its biggest one-day loss since March 18.
‘U.S. Futures have turned positive and this has been a major factor for the region,’ said Stan Shamu, market strategist at IG Markets.
‘The fact is we have central banks committed to maintaining ultra-loose policies in order to resuscitate the global economy and this will help underpin equities.’
The broad rout in commodities overnight, led by gold tumbling another $125 per ounce on Monday in its biggest-ever daily loss, weighed on sentiment.
Gold rebounded 1 percent on Tuesday, but investors frustrated by the metal’s lacklustre performance remained cautious amid fears of central bank sales and global growth.
Gold miners were routed. Evolution Mining Ltd slumped 18.1 percent, Newcrest Mining Ltd lost 5.1 percent and Regis Resources Ltd dropped 2.5 percent.
The economic recovery in China, Australia’s biggest export market, unexpectedly stumbled in the first three months of 2013 with slowing factory output and investment spending forcing analysts to start slashing full-year forecasts.
‘I think in the medium term chances are that we will move lower,’ said Ric Spooner, chief market analyst at CMC Markets.
‘For the next few days I think that reaction to the U.S. housing and industrial production as well as quarterly production reports from our mining companies will be a key in whether the market can consolidate for a while around here or whether we keep falling.’
Global miners BHP Billiton Ltd and Rio Tinto fell 0.5 percent and 0.2 percent respectively.
Mining services firms also lost out, with Monadelphous falling 0.5 percent while NRW Holdings Ltd sank 7.8 percent. Shares in Ausdrill Ltd were in a trading halt pending an announcement regarding the company’s earnings guidance.
Defensives helped contain broader losses. Consumer staples Woolworths Ltd climbed 0.9 percent while rival Wesfarmers finished flat. Top telecommunications provider Telstra Ltd rose 0.9 percent.
New Zealand’s benchmark NZX 50 finished 0.6 percent or 26.9 points lower at 4,427.8.
(AGENCIES)
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