Australia shares fall, many investors stay on sidelines

Wed Sep 3, 2014 10:17pm EDT

Related Topics

* Resource and financial stocks slip

* Investors cautious on geopolitical tensions

* 67 shares were higher vs 120 shares down, 13 shares unchanged (Adds analysis, quotes, stocks on the move)

By Swati Pandey and Gyles Beckford

SYDNEY/WELLINGTON, Sept 4 (Reuters) - Australian shares fell 0.4 percent on Thursday, with broad-based selling rooted in weakness in resources after iron ore prices fell overnight to near five-year lows.

Many investors, still digesting a mixed earnings season the past two weeks, sat on the sidelines hoping geopolitical tensions will ease.

"There's no definite lead coming out of the United States. Investors are a bit cautious about geopolitical tensions," said Tony Russell, senior equities adviser at RBS Morgans Reynolds Equities.

"Our markets had performed very strongly in the last month so there is little bit of profit-taking as well."

The S&P/ASX 200 index, hovering near six-year highs, fell 20.6 points to 5,635.5 by 0143 GMT on Thursday. The benchmark barely changed on Wednesday.

Russell expects the market to trade in a 100-150 point range in the near-term.

U.S. stocks were flat on Wednesday. A decline in Apple dragged the Nasdaq lower and investors held off on big bets before the European Central Bank's coming policy meeting.

Wotif.com Holdings Ltd shares fell 7.4 percent, their biggest one-day drop in 5-1/2 months, after Australia's competition watchdog deferred a ruling on U.S. travel giant Expedia Inc's proposed acquisition of the company.

Shares of Recall Holdings Ltd rose 2 percent after it entered an agreement to sell its secure destruction services business in Germany.

Newcrest Mining Ltd fell 2 percent with gold trading near 2-1/2 month lows. Rare earth miner Lynas Corp was down 5.9 percent and BHP Billiton fell 0.3 percent.

The four major banks - Commonwealth Bank of Australia , Westpac Banking Corp, Australia and New Zealand Banking Group and National Australia Bank - also declined.

New Zealand stocks were flat, with the benchmark NZX-50 index barely changed at 5225.94.

Telecommunications company Spark Ltd, the market's second biggest stock, nudged 1.1 percent higher to NZ$3.025, within sight of the six year high seen in late August.

The bigger moves were among mid-cap stocks, with retailer Briscoe Group up 3.4 percent to a lifetime high of NZ$3.00 after posting a sharply higher first half profit and lifting its dividend payout.

Bio-technology stock Pacific Edge surged 4.9 percent to NZ$0.86 after reporting it had been granted a U.S. patent for a melanoma detection test. (Editing by Richard Borsuk)

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