Australia shares fall on bank downgrades

Tue Apr 29, 2014 1:18am EDT

* S&P/ASX 200 reverses early gains to end lower
    * Banks drag as investment firms issue downgrades

 (Updates market moves)
    By Thuy Ong
    SYDNEY, April 29 (Reuters) - Australian shares fell on
Tuesday, pulling back from near six-year highs, as investors
took profits after several investment firms downgraded their
outlook for banks.  
    The S&P/ASX 200 index fell 0.9 percent to 5,487.1 by
0515 GMT, looking set to break seven consecutive sessions of
gains. The benchmark had earlier touched a fresh near 6-year
high of 5,554.5 before sliding to session lows of 5,469.3. 
    In a research note to clients Citigroup lowered Westpac
Banking Corp and National Australia Bank's ratings to 'neutral'
and 'sell' respectively.
    Elsewhere, Morgan Stanley retained its "underweight" rating
on NAB while local media reported Bell Director Charlie Aitken
had downgraded his recommendation on all four 'Big Banks'. 
    "Morgan Stanley and Citi have changed their outlook
particularly on NAB, both of them are fairly negative, expecting
some disappointments to come through in their results next
Thursday," said Evan Lucas, market strategist at IG.
    Westpac Banking Corp lost 1.2 percent, while
Commonwealth Bank of Australia dropped 0.9 percent.
Australia New Zealand Banking Group shed 1 percent and
National Australia Bank lost 1.6 percent. 
    Commonwealth Bank, Westpac and ANZ had all touched record
highs over the past few sessions. 
    New Zealand's benchmark NZX 50 index ticked up 0.6
percent to 5,148.3.

 (Additional reporting by Maggie Lu Yueyang,; Editing by Shri
Navaratnam & Kim Coghill)