October 23, 2018 / 6:29 AM / 5 months ago

Australia stocks fall, domestic uncertainty adds to weak sentiment; NZ down

* Australian energy, financial stocks lead decline

* Healthscope biggest gainer after takeover offer (Updates to close)

Oct 23 (Reuters) - Australian shares closed lower on Tuesday as sentiment was hit by domestic and global political uncertainty, with most sectors posting big declines.

Concerns over the Italian budget, impasse on Brexit talks as well as tensions between the West and Saudi Arabia over the killing of a journalist have dented global risk appetite.

Losses overnight on Wall Street, partly on nerves amid the U.S. earnings season, put Sydney on the backfoot from the start, with S&P/ASX 200 index closing down 1.1 percent at 5843.1. It marked the third session of losses, following a 0.6 percent drop on Monday.

Political uncertainty in Australia also undercut sentiment after Australia’s ruling Liberal National government suffered a disastrous by-election loss over the weekend, snatching away its one-seat majority.

The energy index led declines and fell 3.2 percent to a over four-month closing low, as global oil prices dipped amid nervousness in the run-up to U.S. sanctions against Iran’s exports that start next month. Woodside Petroleum Ltd and Santos Ltd lost 2.9 percent and 2.8 percent, respectively.

Oil Search Ltd ended 4.4 percent down despite reporting strong quarterly results.

Financial stocks lost 1.2 percent, with the country’s third largest lender Australia and New Zealand Banking Group slipping 1.9 percent.

Commonwealth Bank of Australia finished 1.1 percent down. The lender said that it would sell its 80 percent stake in Indonesian life insurance business PT Commonwealth Life.

Australia’s financial sector has been under intense scrutiny this year, and has been heavily sold off over the past months, after revelations of widespread misconduct.

Healthcare stocks also ended lower as heavyweight CSL Ltd’s 1.9 percent decline weighed on the sector.

Bucking the trend, hospital operator Healthscope Ltd rose a record 20 percent after it received a renewed A$4.11 billion ($2.90 billion)takeover bid from private equity suitors. The stock was the biggest gainer on the ASX 200. The metals and mining sub-index declined 1.1 percent, as mining giants BHP and Rio Tinto fell 1.1 percent and 0.8 percent, respectively. Worries about slowing growth in China, a big buyer of Australian resources, have weighed on the sector.

New Zealand’s, benchmark index S&P/NZX 50 fell 1.5 percent or 129.08 points to 8,673.18, led by healthcare and consumer stocks.

Medical device maker Fisher & Paykel Healthcare Corp fell 4.4 percent, while a2 Milk Company lost 0.6 percent.

Sellers circled Fisher & Paykel after a German regional court found that certain products of the company infringed a patent held by U.S. based ResMed Inc.

$1 = 1.4164 Australian dollars Reporting by Niyati Shetty in Bengaluru Editing by Shri Navaratnam

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