Shares eased after the company reporting season got off to a disappointing start, with fund managers and equity strategists eager for evidence that the sharemarket’s recent six-year highs are justified.
The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each edged down 0.1 per cent, on Monday to 5577.4 points and 5569.9 points respectively.
Australian shares took a weak lead after major equity markets in the United States and around Europe declined on Friday night. Despite flirting with brief gains during the session the local bourse edged lower in late trade.
Resources giant BHP Billiton did the most to lift the index into the black, adding 0.3 per cent to $39.10. The miner said it is set to undertake a heap leaching trial at its Olympic Dam project in South Australia. Plans in 2012 to spend $US30 billion ($31.9 billion) expanding the mine were deferred.
Main rival Rio Tinto gained 0.4 per cent to $65.36, as the spot price for iron ore, delivered in China, added 0.7 per cent to $US94.30 a tonne. When the ASX closed Dalian iron ore futures trading in China was tipping a solid gain in the spot price overnight.
Mining was the best-performing sector, up 0.3 per cent. But while the nation’s biggest miners lifted the mood, in the mining services sector remains grim.
Engineering contract services provider Leighton Holdings dropped 2.4 per cent to $22.10 after it showed a 20 per cent drop in first-half net profit. However the company maintained its full-year earnings guidance.
Mining services provider Boart Longyear rose 2.2 per cent to 23¢ despite the company warning it risks breaching its financial covenants if market conditions continue to deteriorate more than expected.
National Australia Bank lifted 0.3 per cent to $34.69 as it sold a parcel of distressed loans from its challenged United Kingdom business worth £625 million ($1.13 billion).
Among the rest of the big four banks, Commonwealth Bank of Australia fell 0.3 per cent to $82, Westpac Banking Corporation lost 0.3 per cent to $34.18, and ANZ Banking Group shed 0.7 per cent to $33.52.
The biggest food and liquor sellers were also lower. Woolworths dropped 0.3 per cent to $35.88, while Wesfarmers, owner of Coles, fell 0.2 per cent to $43.21.
Telstra Corporation was another laggard, falling 0.4 per cent to $5.43.
Online real estate advertiser REA Group fell 0.4 per cent to $47.85 as it announced a deal to pay $106 million for a 17.2 per cent stake in smaller rival iProperty. Shares in iProperty soared 18.3 per cent to $3.69.
A $2.25 billion initial public offer from Healthscope, the biggest to come to market in 2014, overcame the soft market conditions.The private hospital, pathology clinic, and medical centre operator debuted bang-on its offer price of $2.10, closing 0.1 per cent ahead at $2.21.
Adult education and training provider Navitas was the worst-performing stock in the ASX 200, dropping 3.7 per cent to $4.98, as it revealed a 31 per cent drop in full-year profit.
Appliance maker GUD Holdings was the best-performing stock in the ASX 200, climbing 9.9 per cent to $7.25.
