Close Shares closed lower, back below the key 5000 point level, knocked by resources stocks on worries that demand for metals and oil might not keep up with recent spikes in commodities prices.
Some observers saying the gains that took the local bourse to a new 18-month high on Monday were flimsy given they were achieved on light trading volumes.
At the close, the benchmark S&P/ASX200 index was down 32.7 points, or 0.7 per cent, at 4951.6, while the broader All Ordinaries index fell 33.2 points, or 0.7 per cent, to 4978.4.
Among the sectors, Materials stocks dropped 1.6 per cent, industrials fell 0.9 per cent and financial stocks were 0.2 per cent lower.
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‘‘It’s been a bit of an upside down day on the Australian share market,’’ City Index market strategist Michael McCarthy said. ‘‘We’ve seen it pull back from 18-month highs, very close to the technically important level of 5,000 points.
‘‘It is joining a weak performance by stocks in the Asian region, with Japan down more than one per cent.
‘‘Speaking to traders this afternoon, they attributed the moves to profit-taking, citing the losses in resources stocks as evidence that the best performing stocks were suffering the most.
‘‘Recent data releases are an unlikely cause, with the banking and finance sector outperforming the broad market despite weak housing finance figures yesterday.’’
Macquarie bucks trend
Insurer QBE and financial services giant Macquarie Group were among the best performers.
QBE was up 26 cents, or 1.2 per cent, at $22.05 while Macquarie Group gained 55 cents, or 1.1 per cent, to $50.00.
Among key bank stocks, ANZ was 6 cents firmer at $25.42, Westpac slipped 9 cents to $27.75, National Australia Bank backtracked 10 cents to $27.55 and Commonwealth Bank gave up 31 cents to $58.09.
Mining giant BHP Billiton shed 61 cents to $43.84 and Rio Tinto dropped $1.16 to $79.50.
Lihir Gold was down 6 cents at $3.92 and Newcrest lost 52 cents to $34.41.
In the energy sector, Oil Search was off 13 cents at $5.90, Santos was 28 cents cheaper at $14.64 and Woodside retreated 77 cents to $47.00.
Woodside said disputes between traditional owners in Western Australia’s Kimberley region should not alter its overall development schedule for the Browse gas processing hub at James Price Point.
ERA production slumps
In other headlines, uranium miner Energy Resources of Australia said March quarter production at its Ranger mine in the Northern Territory fell 27 per cent to 888 tonnes, compared to the same period a year earlier. Softer prices for uranium on the spot market would have only a small effect on expected average sale prices achieved during the first half of 2010, given ERA sells most of its product on long-term contracts.
Shares in ERA were down $1.17, or 5.9 per cent, at $18.52.
Iluka Resources will place its Eneabba mine in Western Australia on care and maintenance as it continues to reduce its reliance on mature operations in the state. Iluka also said it had frozen executive salaries this year in light of an expected first half net loss due to soft demand for mineral sands.
Shares in Iluka were down 20 cents, or 4 per cent, at $4.78.Shares in Alumina had fallen 10.5 cents, or 5.6 per cent, to $1.775 after quarterly results from its joint venture partner Alcoa fell short of expectations.
Myer slumps
In the retail space, Coles owner Wesfarmers was down 9 cents at $32.28, Woolworths was 51 cents weaker at $27.77, Myer was 10 cents, or 3 per cent, weaker at $3.22 and David Jones was 13 cents softer at $4.57.
Among key media stocks, News Corp was off 25 cents at $18.95, its non-voting scrip eased 24 cents to $16.07 and Fairfax dipped 2.5 cents to $1.775.
The top-traded stock by volume was junior energy explorer Empire Oil and Gas, with 575.3 million shares worth $6.4 million changing hands. Shares in Empire Oil and Gas, which announced a new gas discovery in Western Australia’s Perth Basin today, leapt 0.6 cents, or 75 per cent, to 1.4 cents.
Preliminary market turnover was 3.14 billion shares worth $5.48 billion, with 426 stocks up, 689 down and 369 unchanged.
AAP, with BusinessDay