SYDNEY May 7 Australian stocks dropped 1
percent to a three-week low on Wednesday, with selling hitting a
broad range of shares, as market confidence was by hit mounting
worries about Ukraine and before the announcement of the federal
budget next week.
The S&P/ASX 200 index was down 55.4 points at
5,426.0 as of 0217 GMT, having touched its lowest level since
April 16. The benchmark had risen 0.4 percent on Tuesday.
"What's happening in Ukraine is a key issue ... The market
is also reacting here in Australia to the outcome of the federal
budget," said Martin Lakos, division director at Macquarie
Traders were keeping an eye on developments in Ukraine and
the heightened possibility of that country slipping into civil
war, with supporters of Russia and of a united Ukraine accusing
each other of tearing the country apart.
Meanwhile, Australia's coalition government next week will
hand down its first budget since winning the election in
September last year, and has already flagged a series of
Wall Street stocks also fell overnight, adding to
investor anxiety that saw broad-based selling in stocks from
banks to miners.
Commonwealth Bank of Australia lost 1 percent and
Westpac Banking Corp fell 0.9 percent.
BHP Billiton Ltd dropped 1.1 percent and Rio Tinto
Ltd shed 1.6 percent.
Miners have also come under pressure from an uncertain
outlook for resources demand amid doubts over whether seasonal
demand will pick up strongly with China's economy on shaky
Ric Spooner, a market analyst at CMC Markets, said traders
might be wary of building positions ahead of local employment
data due on Thursday.
Shopping mall giant Westfield Group lost 1 percent
after it said late on Tuesday it would improve the terms of its
merger for shareholders of Westfield Retail Trust (WRT)
by A$300 million. WRT edged up 0.2 percent.
Australian packaging group Amcor Ltd skidded 1
percent after announcing the acquisition of Indonesian flexible
packaging company Bella prima Packaging for A$27 million.
New Zealand's benchmark NZX 50 index slipped 0.2
percent to 5,165.7.
(Reporting by Maggie Lu Yueyang; Editing by Chris Gallagher)