Business

Wed Jun 11 23:38:53 PDT 2008

SYDNEY, June 12 (Reuters) – Australian shares fell 2.2 percent to a two-month low on Thursday, with financial firms such as Macquarie Group <MQG.AX> leading losses on concerns about more credit-related losses and as inflation worries grew.

The benchmark S&P/ASX 200 index <.AXJO> fell 119.8 points to 5,347.5 by 0200 GMT, a level not seen since April 15.

New Zealand’s benchmark NZX-50 index <.NZ50> fell 0.9 percent, or 32.36 points, to 3,455.07. The most heavily weighted stock, Telecom Corp of New Zealand <TEL.NZ>, was down 1.3 percent at NZ$3.75.

STOCKS ON THE MOVE

* Perilya Ltd <PEM.AX> climbed 13.2 percent to A$0.645.

The zinc miner said a new resource, which has been established at its Flinders Project in South Australia, would significantly improve the project’s development prospects.

0159 GMT

* Worries about credit markets hit financial shares.

Among the top banks, National Australia Bank fell 4 percent to A$27.65 and Commonwealth Bank of Australia Ltd <CBA.AX> lost 2.5 percent to A$41.75.

Australia and New Zealand Banking Group Ltd <ANZ.AX> fell 1.6 percent to A$20.07 while Westpac Banking Corp <WBC.AX> shed 3.5 percent to A$21.48.

Macquarie Group <MQG.AX>, Australia’s top investment bank, dropped 4.2 percent to A$51.47, while rival Babcock & Brown <BNB.AX> slumped 13.8 percent to A$8.21.

0050 GMT

* Global miner BHP Billiton Ltd <BHP.AX> fell 4.2 percent to A$41.61, putting further pressure on the market.

BHP said it would immediately shut down its Kwinana nickel refinery in Western Australia for about four months as it had to rebuild a furnace at its Kalgoorlie nickel smelter earlier than planned [ID:nSYD320383].

BHP’s main rival and takeover target Rio Tinto Ltd <RIO.AX> lost 3.3 percent to A$127.74.

0048 GMT

* Investment fund Babcock & Brown Power Ltd <BBP.AX> dropped 22.6 percent to A$1.01 after it said its earnings are likely to fall in the short term due to the disruption to gas supplies in Western Australia following an explosion at a major gas plant last week [ID:nSYU004536].

0047 GMT

* Shares of retailers fell on growing concern that surging living costs will continue to hit consumer spending.

Harvey Norman Holdings Ltd <HVN.AX> dropped 3.3 percent to A$3.18, Woolworths Ltd <WOW.AX> fell 2 percent to A$26.60 and David Jones Ltd <DJS.AX> lost 1.2 percent to A$3.19.

0044 GMT

* Energy firms advanced after oil prices <CLc1> on Wednesday jumped more than $5 to within sight of record highs after a report showed stockpiles in the United States fell sharply for the fourth week in a row.

Woodside Petroleum, Australia’s second-largest oil and gas producer, rose 2 percent to A$62.83, Oil Search Ltd <OSH.AX> added 0.7 percent to A$5.89 and Roc Oil Ltd <ROC.AX> rose 1.5 percent to A$2.09.

0043 GMT

* Gold miners also rose after the rise in oil and a softer U.S. dollar pushed the price of the precious metal <XAU=> up by over 1 percent on Wednesday.

Lihir Gold <LGL.AX> rose 1 percent to A$2.91 and Sino Gold <SGX.AX> gained 5 percent to A$4.59.

0041 GMT ($1=A$1.05)

(Reporting by Geraldine Chua)

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