Australia Stocks Snap Winning Streak as Banks Weigh

By Robb M. Stewart Features Dow Jones Newswires

MELBOURNE, Australia--Australian shares ended a four-session winning streak, falling Monday with a selloff of the major banks.

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The local market underperformed major indexes in the region, shrugging off positive leads from fresh record highs for U.S. stocks at the end of last week and a rebound in iron-ore prices.

The decline comes a day before the Reserve Bank of Australia's monthly policy meeting, which is widely expected to see the benchmark cash rate held at a record low, and two days ahead of economic-growth figures for the first quarter of the year.

Wiping out most of last week's modest advance, the S&P/ASX 200 ended 33.2 points, or 0.6%, lower at 5454.9.

The four biggest banks collectively knocked almost 21 points off the index, retreating from a recovery on Friday.

The lenders struggled in May after lackluster earnings raised concerns among analysts that share prices had risen too strongly since the U.S. election, and with fresh concerns over coming regulatory changes that could mean the big banks need to further increase capital buffers. A surprise tax on the major banks' liabilities, introduced with the federal budget, further damped sentiment.

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Australia & New Zealand Banking, Commonwealth Bank of Australia, National Australia Bank and Westpac Banking lost between 1.3% and 1.8%. Investment bank and asset manager Macquarie dropped by 2%.

Regional lender Bendigo & Adelaide slumped 4.4% after it said it was changing how it accounts for earnings for its Homesafe unit to exclude any unrealized income and associated funding costs, although there would be no change to its statutory earnings.

Although Fortescue Metals Group rose 0.8%, BHP Billiton and Rio Tinto lost 1.7% and 1.3%, respectively. Chinese iron-ore futures recovered from recent weakness.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

June 05, 2017 03:26 ET (07:26 GMT)