Australia Stocks Falter, Pulling Back on Gains

MELBOURNE, Australia--Australian stocks pulled back sharply Friday from strong gains the last two sessions, tracking global equity markets as trading volatility picked up this week.

Broad selling for the session eroded gains over the week and extended a decline over the last quarter.

"Despite the weakness in U.S. and European shares, Australian shares managed a small rise over the last week helped by a rebound in commodity prices," said Shane Oliver, head of investment strategy and chief economist at AMP Capital in Sydney.

There was also some buying for superannuation pension funds ahead of new government-imposed limits that will affect some members from the start of the new fiscal year on July 1, Mr. Oliver said.

Ending near the day's low, the S&P/ASX 200 dropped 96.6 points, or 1.7%, to 5721.5.

It was the sharpest drop of 2017 for the index, leaving it up just 0.1% for the week and 2.5% lower for the quarter.

Only about a dozen stocks rose for the session, as all industry subindexes retreated.

After helping buoy the market the last two days, major banks Commonwealth Bank of Australia, Westpac Banking, Australia & New Zealand Banking and National Australia each lost 1% or more. Still, the four averaged a 1.9% gain for the week as financial shares recovered from heavy selling in May, when the major banks were hit with a fresh tax on their liabilities that added to concerns about the housing market and looming changes to regulatory capital requirements.

Diversified miners BHP Billiton and Rio Tinto fell 0.9% and 0.2%, respectively, but Fortescue Metals Group edged up 0.2% after Chinese iron-ore futures eased from the best levels in more than a month.

Among energy shares, Woodside Petroleum declined 2.1%, Oil Search shed 1.2% and Santos was 2.6% lower.

For the Australian fiscal year, the ASX 200 was up 9.3%.

Write to Robb M. Stewart at

(END) Dow Jones Newswires

June 30, 2017 03:45 ET (07:45 GMT)