July 17, 2018 / 6:36 AM / 4 months ago

Australian shares weaker as oil slump hits energy stocks; NZ flat

* Sharp fall in oil prices swipes over 2 pct off energy index

* Weak commodity prices weigh on materials (Updates to close)

By Nikhil Nainan

July 17 (Reuters) - Australian shares fell on Tuesday, as an overnight slump in oil prices and weaker commodities squeezed energy and mining stocks.

The S&P/ASX 200 index fell 0.6 percent to 6,203.6 at the close of trade. The benchmark fell 0.4 percent on Monday.

The Australian energy index closed over 2 percent lower to its lowest level in nearly a month, after oil prices tumbled over 4 percent overnight as Libyan ports reopened and traders eyed supply increases by Russia and other producers.

Oil prices attempted a slight recovery in early Asian trade, but not enough to sway investors as prices took a dip soon after, furthering losses among energy stocks.

Woodside Petroleum was the biggest drag on the energy index, while Origin Energy and Oil Search fell 2.1 percent and 2.8 percent, respectively.

Oil Search investors were doubly hit on Tuesday with both the oil price slump and a reported 18 percent decline in first half revenue hitting the stock.

Weaker commodity prices added to market woes, and hit miners, with the main mining index down 1.4 percent.

Global miner Rio Tinto slipped 0.3 percent, as prices overshadowed a jump in iron ore output shipments from Australia and expectations of a stronger 2018 performance.

“The Rio result wasn’t too bad, but when you see copper and lead prices down they get a wash down from those negative price moves,” said James McGlew, executive director of corporate stockbroking at Argonaut.

Concerns over signs of softening in the Chinese economy - Australia’s biggest export market - also dented sentiment after data showed second quarter economic growth expanded at a slower pace with June industrial output growth the weakest in over two years.

New Zealand’s benchmark S&P/NZX 50 index ended the session flat, at 8,978.89.

Gains in Fisher & Paykel Healthcare Corporation Ltd were offset by a 1.7 percent and 2.1 percent drop in a2 Milk and embattled Fletcher Building. (Reporting by Nikhil Kurian Nainan in Bengaluru; additional reporting by Mensholong Lepcha; Editing by Sam Holmes)

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