Australia Stocks Seesaw, With Gold, Oil Shares Weak

By Michael KitchenMarketWatch Pulse

Australian stocks waded into and out of shallow losses early Monday, with resource shares mostly weak but with banks pivoting off a lower open to grab some modest gains. About 45 minutes into the session, the S&P/ASX 200 was little changed from its previous close, sitting at 5,670.40 after registering a small drop shortly after the open. Hard times for Comex gold futures hit Evolution Mining Ltd. (down 9.9%) and Newcrest Mining Ltd. (down 5.3%) which also reported a mining halt at Hidden Valley after a fatal accident there. Likewise, declines for Nymex and Brent crude-oil contracts helped weigh on Oil Search Ltd. (down 0.9%) and WorleyParsons Ltd. (down 1%). On the hand, copper and gold extractor Sandfire Resources rose 3.5% after a drilling update on its Doolgunna project, and the senior miners were mixed, with BHP Billiton Ltd. down 1%, but Rio Tinto Ltd. up 0.3%. The big banks had traded lower early in the session, possibly reacting to news that their regulator planned to raise the risk weight for mortgages, effective next July. However, the Big Four soon recovered, with Australia & New Zealand Banking Group up 0.6%, Commonwealth Bank of Australia up 0.4%, National Australia Bank Ltd. up 0.2% and Westpac Banking Corp. flat. Back on the downside, shares of Sonic Healthcare Ltd. retreated 3.8% after the medical-laboratory company cut its forecast for the fiscal year ended in June.

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