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Australia shares slip on US caution, Woolworths drops 1.9 pct
July 30, 2013 / 1:36 AM / 4 years ago

Australia shares slip on US caution, Woolworths drops 1.9 pct

(Adds analysis, quotes, stocks on the move)

SYDNEY, July 30 (Reuters) - Australian shares slipped 0.3 percent on Tuesday, pulled down by grocer Woolworths, while investors marked time before the outcome of the U.S. Federal Reserve monetary policy meeting that could shed light on when the Fed may start running down its stimulus effort.

Supermarket giant Woolworths Ltd lost 1.9 percent to A$33.14. The company reported a 4.3 percent increase in fourth-quarter sales, but said the retail environment remained challenging.

Woolworths also warned that losses for its troubled home-improvement joint venture Masters would blow out beyond previous guidance to A$157 million for the 2012/13 financial year. Rival food and hardware retailer Wesfarmers Ltd tumbled 1 percent.

“People didn’t like the report that came out, but even so we are seeing a bit of weakness across other stocks as well, today there’s a bit of modest underperformance,” said Damien Boey, equity strategist at Credit Suisse.

The S&P/ASX 200 index fell 13.2 points to 5,033.1 by 0117 GMT. The benchmark crept up 0.1 percent on Monday.

Financials also trailed. Australia and New Zealand Banking Group fell 0.7 percent while top lender Commonwealth Bank of Australia slipped 0.4 percent.

Miners helped pare broader losses after copper steadied on Monday. BHP Billiton Ltd added 0.3 percent while gold miner Newcrest Mining Ltd soared 2.1 percent.

U.S. stocks fell on Monday, pulling back before Wednesday’s outcome of the Federal Reserve meeting that could signal when the Fed is going to begin reducing its stimulative bond purchases.

“Wall Street is still mostly at all-time highs as markets sit tight and await clues,” Tracey Warren, stockbroking sales executive at CMC Markets said in a note. “The U.S. monthly jobs report due at the end of the week is also keeping investors on edge.”

New Zealand’s benchmark NZX 50 index fell 0.3 percent or 13.4 points to 4,565.


* Sundance Resources Ltd jumped 2.5 percent to A$0.08 after the company said it expects to wrap up talks with potential partners by the end of 2013 to fund its $4.7 billion Mbalam-Nabeba iron ore project between Cameroon and the Republic of Congo. That is about six months later than the company flagged to Reuters in May.

(0113 GMT)

* Transurban Group dropped 4.2 percent to A$6.70, a three-week low. UBS sold 4.8 percent of the Australian-listed toll road operator and owner worth A$477.3 million, a person familiar with the matter told Reuters on Monday.

(0114 GMT)

* Otto Energy Ltd slumped 12.9 percent to four-week lows of A$0.08 after the company had to stop its Duhat-2 exploration drilling campaign after high pressure water and high flow rates showed very low trace gas readings.

0115 GMT Reporting by Thuy Ong; Editing by Eric Meijer

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