(Adds analysis, quotes, stocks on the move)
SYDNEY Aug 22 (Reuters) – Australian shares were down 0.5
percent on Thursday morning, as relief from an upbeat Chinese
manufacturing report wasn’t enough to offset a mixed bag of
earnings and minutes from the U.S. Federal Reserve’s last
meeting, which failed to allay concerns of an imminent reduction
in stimulus.
A handful of big cap miners dragged on the market after
copper fell overnight on a strengthening U.S. dollar.
BHP Billiton Ltd and Rio Tinto Ltd fell
0.8 percent and 0.4 percent respectively. However, Fortescue
Metals Group Ltd rallied 3.7 percent after the iron ore
company reported a 21 percent on-year rise in revenue to $8.1
billion compared to last year.
“With earnings season at or over the hump it’s likely the
market will ease off over the next few weeks as investors take
profits,” said Chay Flack, equities dealer at CMC Markets
Stockbroking in a note to clients.
The S&P/ASX 200 index fell 37.4 points to 5,062.6 by
0259 GMT, recovering slightly from the session’s lows after a
preliminary China HSBC Purchasing Managers’ Index report showed
manufacturing in Australia’s largest export market hit a
four-month high in August..
Global markets hard hit overnight after the Fed’s minutes
suggested a reduction to its massive stimulus could yet start as
early as next month.
The Australian benchmark, which closed 0.4 percent higher on
Wednesday, has outperformed emerging markets in the region,
losing 1.6 percent so far this week compared with the 5.1
percent drop in the Thomson Reuters South East Asia Index.
.
Markets from India to Indonesia have suffered heavy selloffs
recently on expectations Western investors will repatriate funds
now that yields at home are rising.
“Regionally we’re viewed as being more defensive than say
India or China,” said Damien Boey.
“A lot of these economies, like Indonesia, India, are in
some way shape or form linked to the U.S. and they’re very
heavily exposed to the tapering that the Fed is potentially
going to do.”
Other big earnings-related movers included Origin Energy,
which jumped 6.2 percent to 2-month highs of A$13.03
after reporting a full-year underlying profit of $760 million.
On the downside, Atlas Iron Ltd tumbled 6.5 percent
to a two-week low of A$0.87 after it reported underlying profit
after tax of $14 million versus $72 million the previous year.
Pallet maker Brambles Ltd also lost 5.1 percent to
trade at a 3-1/2 month low of A$8.72 despite posting a rise in
full year net profit of 11 percent. Shares in Brambles have
climbed 22 percent this year, against a 10 percent rise in the
broader market.
Financials also weighed on the market, with Westpac Banking
Corp shedding 0.9 percent while Australia and New
Zealand Banking Group lost 0.8 percent. The banking
sector, led by the “big-four” banks, has outperformed the
broader market this year, partly boosted by strong earnings and
high dividend yields.
New Zealand’s benchmark NZX 50 index slipped 0.5
percent to 4,527.5.
(Reporting by Thuy Ong; Editing by Shri Navaratnam)
Source Article from http://www.reuters.com/article/2013/08/22/markets-australia-stocks-idUSL4N0GM3RW20130822
