Australia shares widen losses as central bank holds rate at 12-year peak

Woodside Energy

05/11/2024 04:33

(Updates with RBA decision, moves)
       Nov 5 (Reuters) - Australian shares extended losses on
Tuesday after its central bank retained the key policy rate at a
12-year high in an attempt to keep the policy restrictive until
core inflation is tamed.
    The S&P/ASX 200 index  .AXJO  fell 0.4% to 8,131.4 points by
0352 GMT. The benchmark was trading 0.3% lower ahead of the
policy decision. It had closed 0.6% higher on Monday.
    The Reserve Bank of Australia (RBA) kept the interest rate
unchanged, in line with the Reuters' poll, reiterating that the
policy would need to be restrictive until core inflation slowed
as desired.
        Australia's sticky core inflation data last week also
reinforced expectations that the central bank, which lags its
peers in starting the monetary easing cycle, will further delay
its cuts.
    Australian banks  .AXFJ  slid 0.8% as investors booked in
profits. The largest lender, Commonwealth Bank of Australia
 CBA.AX , dropped 0.7%, while Westpac  WBC.AX  shed 1.5%.
    Energy stocks joined banks to decline 0.7%, tracking a fall
in global oil prices. Sector majors Woodside  WDS.AX  and Santos
 STO.AX  were trading 1.1% and 0.7% lower, respectively.
    Global investors are cautious ahead of the U.S. presidential
election, as Republican Donald Trump and Democrat Kamala Harris
remain virtually tied in opinion polls ahead of polling on
Tuesday and the winner might not be known for days after voting
ends.
        Bucking the trend, miners  .AXMM  traded 0.4% in the
green. Sector heavyweights BHP  BHP.AX , Rio Tinto  RIO.AX  and
Fortescue  FMG.AX  gained 0.7%, 0.9% and 0.7%, respectively.
    Other sectors, including the consumer staples  .AXSJ , reits
 .AXRE  and gold  .AXGD , also dragged.
    Meanwhile, pizza-maker Domino's  DMP.AX  was the biggest
loser on the benchmark, with shares dropping to their lowest in
nearly two months after its long-serving chief executive Don
Meij decided to step down.
    New Zealand's benchmark S&P/NZX 50 index  .NZ50  was trading
marginally higher.

 (Reporting by Roushni Nair and Rajasik Mukherjee in Bengaluru;
editing by Alan Barona and Sumana Nandy)
 ((Roushni.Nair@thomsonreuters.com))
 
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