SYDNEY--Australian stocks shrugged off a positive lead from Wall
Street to close 0.2% lower Friday after softer oil and industrial
metal prices hurt resources plays, while banks remained in the
doldrums.
The S&P/ASX 200 index shed 11.4 points to 5545.3, ending a
topsy-turvy week 0.9% stronger.
Copper prices slid to their lowest levels in seven weeks
Thursday, dented by a stronger U.S. dollar and mixed economic data
from China. The price of oil also fell amid lingering concerns
about global glut, as did aluminum, lead, zinc, tin and nickel,
though iron ore rose 0.5% to US$65.40/metric ton.
Light, sweet crude for July delivery settled down 66 cents, or
1.1%, to $60.77 a barrel on the New York Mercantile Exchange.
Brent, the global benchmark, fell 59 cents, or 0.9%, to $65.11 a
barrel on ICE Futures Europe.
One of Australia's biggest movers was Energy Resources of
Australia (ERA.AU). The uranium miner plunged 48% after majority
shareholder Rio Tinto Ltd. said it didn't support the development
of a deposit amid slumping uranium prices.
BHP Billiton Ltd. (BHP.AU ) and Rio Tinto (RIO.AU) shed 1.2% and
0.6%, respectively, while Woodside Petroleum Ltd. (WPL.AU) fell
0.3%.
Banking stocks, decimated in recent weeks by rising global bond
yields, reversed some of this week's modest relief rally. Westpac
Banking Corp. (WBC.AU) was the worst performer, falling 0.9%.
Australia & New Zealand Banking Group (ANZ.AU) and National
Australia Bank (NAB.AU) lost 0.3% and 0.8%, respectively, while
Commonwealth Bank of Australia (CBA.AU) closed flat.
"The big four banks are becoming less ugly on fundamentals,"
said Evan Lucas, a strategist at Melbourne-based IG, noting they
are trading at a 31% discount to industrial peers on a
price-to-earnings ratio basis.
Investors are cautious, too, amid uncertainty about Greece's
financing negotiations after the International Monetary Fund said
it was halting bailout talks, frustrated about the lack of progress
towards a deal.
"With yesterday's confidence on Greece being turned around,
stock markets have been forced reluctantly back to a cautious frame
of mind," said Ric Spooner, strategist at Sydney-based CMC
Markets.
Write to Ross Kelly at ross.kelly@wsj.com
