Australia shares take breather as tensions simmer in Korea; NZ dip

By Shashwat Pradhan

July 5 (Reuters) – Australian shares slipped on Wednesday
after the previous day’s solid gains, with financials and real
estate stocks accounting for most of the losses, as rising
tensions in the Korean peninsula checked risk sentiment.

A holiday in the United States and a dearth of major data
kept volumes muted, with investors watching out for minutes of
the Federal Reserve’s last meeting due later in the day.

The S&P/ASX 200 index dipped 0.2 percent or 10.818
points to 5773 by 0230 GMT.

North Korea said it had conducted a test of a newly
developed intercontinental ballistic missile that can carry a
large and heavy nuclear warhead.

“The rhetoric we heard from those guys (North Korea) is
certainly a little bit more aggressive with the fact that they
are looking to have a warhead that can reach the U.S,” said
Chris Weston, an institutional dealer with IG Markets.

“I think it is a step up in their aggressive rhetoric, and
the market is keen to respond with a wave of risk aversion.”

Financials were among the biggest drags, with with the ‘Big
Four’ banks – Westpac, Commonwealth Bank of Australia
, National Australia Bank and Australia New
Zealand Banking – all marginally down.

Real estate stocks also pressured the benchmark, with
Westfield Corp sliding 2.2 percent and Scentre Group
down 1.2 percent.

The Australian central bank on Tuesday cautioned against
record high household debt in the country’s red-hot property
market.

Materials were one of the few bright spots on a day that saw
most of the sectors slipping into the red.

China’s steel rebar futures on Tuesday rose to their highest
in more than three years, before retreating at the close of
trading, as worries over tighter supply fuelled bullish
bets.

Mining giants BHP Billiton Ltd and Rio Tinto Ltd
climbed 1.2 percent and 1 percent respectively.

New Zealand’s benchmark S&P/NZX 50 index fell 0.3
percent or 20.24 points to 7600.4.

Sentiment was affected by a statement from government
property valuer QV saying prices for New Zealand homes grew at
their slowest annual pace in more than two years, as previously
sizzling demand was hurt by regulatory curbs.

Spark New Zealand fell 1.7 percent and was the
biggest drag on the index.

In other stocks, a2 Milk Company shed 0.8 percent
as global dairy prices continued to moderate after a strong run
earlier in the year.

For more individual stocks activity click on

(Reporting By Shashwat Pradhan in Bengaluru; additional
reporting by Hanna Paul; Editing by Shri Navaratnam)

Leave a Reply

Your email address will not be published.