September 17, 2018 / 3:03 AM / 3 months ago

Aussie shares flat as bank gains offset health care slump; NZ falls

* Health care stocks hammered by news of public inquiry

* Financials offset losses

* Materials lower on weaker commodities

By Aditya Soni

Sept 17 (Reuters) - Australian shares were unchanged on Monday as health care stocks were pummelled by the news of a public inquiry into the country’s aged-care sector, though gains in financials limited the losses.

The S&P/ASX 200 index 0.02 percent or 1.50 points to 6,166.80 by 0200 GMT. The benchmark rose 0.6 percent on Friday.

Australia will begin a public inquiry, or Royal Commission, into the country’s aged-care sector as a spike in cases of elderly abuse creates a “disturbing trend”, Prime Minister Scott Morrison said on Sunday.

The inquiry comes at a time when the number of Australians moving into residential care is set to jump, with the population aged 65 years and above, according to official data, forecast to more than double to 8.9 million by 2055.

The news of the inquiry whipped shares of aged-care service providers, with Regis Healthcare Ltd plunging as much as 19.9 percent to a record low, while Estia Health Ltd slumped 15.8 percent to its lowest since December 2016.

“I think the health sector is under pressure this morning on the basis of the Australian government starting a royal commission,” said Damien Rooney, director of equity sales at Argonaut.

The wider health care index was down 0.9 percent. Drugmaker CSL Ltd, the country’s fifth biggest firm by market value, dropped 1.2 percent and was the top drag on the benchmark.

Health care has been the best-performing Aussie sector this year, having risen 31.2 percent in 2018 as of last close.

A sell off in London copper, coupled with a drop in Chinese iron ore futures sapped materials stocks.

Index heavyweight BHP dipped 0.5 percent, while Rio Tinto Ltd fell 0.4 percent.

But financials rose 0.7 percent, braking the benchmark’s slide. “I think it’s the super (pension) funds continuously seeing flows into the index stocks where the banks are fairly large constituents,” said Rooney.

National Australia Bank Ltd rose 0.8 percent. NAB said on Monday that top consumer banking executive Andrew Wagger would leave the bank around Oct 1. after 10 years in charge of a division that allegedly charged fees to hundreds of thousands of retirees for financial advice they never received.

Australia and New Zealand Banking Group Ltd firmed 0.6 percent.

BWX Ltd, a marketer of branded skin and hair care products, surged as much 5.1 percent to a near two-week high after saying it will remain independent after a Bain Capital-led consortium failed to submit a binding proposal and withdrew its takeover offer.

Across the Tasman Sea, New Zealand’s shares edged down, with the benchmark S&P/NZX 50 index dipping 0.2 percent or 14.22 points to 9,258.02.

Health care stocks set the bearish trend, with Fisher & Paykel Healthcare Corporation Ltd falling 1.3 percent, while Ryman Healthcare Ltd dropping 0.4 percent.

Reporting by Aditya Soni in Bengaluru; Additional reporting by Shanima A. Editing by Eric Meijer

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