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Australia shares slip, investors cautious on US fiscal deadlines
September 26, 2013 / 1:35 AM / in 4 years

Australia shares slip, investors cautious on US fiscal deadlines

(Adds analysis, quotes, stocks on the move)

SYDNEY, Sept 26 (Reuters) - Australian shares slipped 0.3 percent on Thursday after Wall Street lost ground overnight as investors fretted over looming fiscal deadlines, though a rise in metals prices helped to limit broader losses.

Financials fell after posting modest gains in the previous session. National Australia Bank fell 0.8 percent while Australia and New Zealand Banking Group slipped 0.5 percent. Westpac Banking Corp lost 0.6 percent.

The Big Four banks have added an average of 27 percent each to their share price so far this year, outperforming the broader market, which has risen 13.1 percent.

The S&P/ASX 200 index was down 12.7 points to 5,263.2 by 0119 GMT. The benchmark rose 0.7 percent on Wednesday after three days of losses.

A handful of defensives also lost ground, with consumer staples retailer Wesfarmers Ltd shedding 0.3 percent while biotechnology firm CSL Ltd slid 1.3 percent, touching 6-week lows.

The local bourse took a lead from U.S. stocks, which fell overnight as the S&P 500 registered a fifth day of losses, its longest losing streak since the end of 2012.

Investors are worried about two looming Washington deadlines: before Oct. 1 Congress needs to pass stop-gap funding for federal agencies and by Oct. 17 it must raise the federal borrowing limit to avoid a debt default by the United States.

“We are entering a seasonally weak period for stocks, being the end of September and October,” said Tim Radford, global analyst at Rivkin Securities in a note to clients.

“In the backdrop there are major fundamental catalysts that could send stocks sharply lower over the next month,” Radford said.

The benchmark index has hovered around the 5,250 point level for most of this week as investors remained cautious in the face of U.S. uncertainty, and trading remained subdued.

“Volumes remain very light, it’s been very quiet” said Martin Lakos, division director at Macquarie Bank.

Elsewhere a rise in metals prices helped bluechip miners eke out a small gain. BHP Billiton Ltd gained 0.4 percent while Rio Tinto Ltd climbed 1.1 percent after copper edged up overnight as solid demand from China helped stem three consecutive days of falls.

The market was also helped by a modest gain among insurance companies, with Suncorp Group Ltd edging 0.2 percent higher.

Linc Energy Ltd soared 11.3 percent to near six-week highs of A$1.72, after the company issued a statement saying its Umiat Alaska core evaluation has confirmed high quality oil-saturated reservoir rock.

New Zealand’s benchmark NZX 50 index fell 0.3 percent or 13.3 points to trade at 4,751.4.

Reporting by Thuy Ong; Editing by Eric Meijer

Our Standards:The Thomson Reuters Trust Principles.
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