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Australia shares dragged lower by financials, N.Korea concerns; NZ up
September 6, 2017 / 7:13 AM / 18 days ago

Australia shares dragged lower by financials, N.Korea concerns; NZ up

(Updates to close)

Sept 6 (Reuters) - Australian shares closed down on Wednesday as Commonwealth Bank of Australia, which is grappling with a money laundering scandal, lost further ground and dented other financials while simmering North Korean tensions checked overall risk appetite.

The S&P/ASX 200 index lower 0.3 percent, or 16.53 points, at 5689.70. The benchmark gained 0.1 percent on Tuesday.

Geopolitical tensions continued to simmer after North Korea’s biggest-ever nuclear test over the weekend, discouraging investments in riskier assets. One of North Korea’s top diplomats on Tuesday said, Pyongyang is ready to send “more gift packages” to the United States.

Financials accounted for nearly three-fourth of the losses on the index, with the financial index down 1.2 percent.

“The banking sector is down and CBA just continues to free fall due to its issues with AUSTRAC,” said James McGlew, executive director of corporate stock broking for Argonaut in Perth.

CBA shares fell 1.2 percent to an almost nine-month closing low. On Tuesday, Australia’s second biggest company by market value was slapped with a class action lawsuit over a money-laundering scandal by litigation financier IMF Bentham Ltd

The rest of the “Big Four” banks followed suit, falling in the range of 0.5 percent to 2.2 percent.

Earlier in the day, data showed the Australian economy expanded 0.8 percent in the second quarter, up from the first quarter though the widely expected result had little impact on equities.

At the other end, Australia’s metal and mining index and the gold index finished the day 0.5 percent up each.

Major miners BHP Billiton finished 0.4 percent up , Rio Tinto was up 0.2 percent and Fortescue Metals Group advanced 0.5 percent.

Gold miner Evolution Mining closed nearly 2 percent up, its highest in more than a year.

CSL Ltd was the best performer on the index, rising 1.1 percent to a near eight-week closing high.

New Zealand’s benchmark S&P/NZX 50 index was up 0.2 percent, or 12.81 points, to 7,790.2 at close.

Global dairy prices climbed higher at an auction on Wednesday, with analysts saying prices could continue to rise as wet weather in New Zealand hits production

Dairy firm a2 Milk Company closed at a record high, up 2.5 percent, while Fletcher Building Ltd was the worst performer on the index, finishing 1.7 percent down. (Reporting by Chandini Monnappa in Bengaluru; Editing by Shri Navaratnam)

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