Australian shares traded lower on Tuesday in the absence of market-moving triggers, with small gains on Wall Street ahead of an appearance by Federal Reserve Chair Janet Yellen doing little to boost market sentiment. The S&P/ASX 200 index which had gained for the past three days, dropped 0.3 percent or 17.06 points to 5,703.10 by 0327 GMT. The benchmark ended 0.1 percent higher on Monday. Janet Yellen, appearing at an interview-style event at London’s Royal Academy later today, is expected to stick to her positive views on the U.S. economy despite some recent weak U.S. economic indicators, supporting the Fed’s forecast of raising interest rates once more this year.
“The markets are pretty comfortable with what Yellen is likely to talk about, said Chris Weston, an institutional dealer with IG Markets. “She will probably lean on the more dovish side of things.” Real estate stocks were a drag on the index with retirement community developer Aveo Group falling as much as 5.5 percent to slump to a near two-year low.
Meanwhile, weaker gold and copper prices pushed the materials sector down. BHP Billiton Ltd fell 1.1 percent while Rio Tinto Ltd dropped nearly 1 percent. Retailer Metcash Ltd and Blackmores Ltd were the biggest percentage losers on the benchmark shedding 3.7 percent and 3.8 percent respectively.
Vitamin maker Blackmores announced on Tuesday the retirement of Chief Executive and Managing Director Christine Holgate. The broad-based losses were slightly offset by gains in three of the ‘Big-Four’ lenders. Westpac Banking Corp rose 0.1 percent, Commonwealth Bank of Australia gained 0.5 percent and Australia and New Zealand Banking Group Ltd was up 0.6 percent while National Australia Bank Ltd shed 0.2 percent.
“Its only financials that are finding any kind of support in the market today, there’s no real catalyst to move markets at the moment,” Weston added. Commonwealth Bank of Australia, the market-leading mortgage lender, hiked interest-only home loan rates on Tuesday following its three main rivals as regulators fret over financial stability risks amid rising housing prices and record-high household debt.
New Zealand’s benchmark S&P/NZX 50 index rose 0.5 percent or 36.92 points to 7,632.42. Telecom and industrial stocks lifted the index although losses in utilities limited gains. Spark New Zealand Ltd climbed as much as 1.6 percent to its highest in 10 months while Auckland International Airport Ltd rose 0.5 percent, extending its gains to a fifth session.
Scales Corporation Ltd and Xero Ltd were among the biggest percentage losers, falling 2.6 percent and 1 percent respectively.