By Dow Jones Business News, October 04, 2013, 03:28:00 AM EDT
By Robb M. Stewart
MELBOURNE, Australia--Australian equities ended the week lower, snapping a run of seven straight weekly gains as
investors have grown increasingly uneasy about the fallout for the world's biggest economy from the budget impasse in
The local market had proved largely resilient following the partial shutdown of the U.S. government, edging higher in
the previous two sessions after falling from a five-year high at the start of the week. But sentiment was knocked Friday
by a further wave of selling on Wall Street that knocked 0.9% off both the Dow Jones Industrial Average and S&P 500.
The impact of the U.S. shutdown is likely to be limited for Australia, since more than 80% of its exports are destined
for Asia, but it comes just weeks before a crucial deadline for lawmakers in Washington to raise the nation's borrowing
"Funding the government's activities is a sideshow compared to the extension debt ceiling. If U.S. lawmakers fail on
this count, a debt default would have severe ramifications for global markets in the immediate future," said Tom
Piotrowski, a market analyst at Commonwealth Securities.
The S&P/ASX 200 fell 0.5% to close at 5208. That left the benchmark index down 1.9% for the week.
"It's all about the waiting game and another weekend of U.S. politicking," said Michael Bogoevski, head of sales
trading at CMC Markets in Sydney.
The mining sector led broad losses, with BHP Billiton dropping 1.3% and Rio Tinto down 0.5% after an overnight fall in
the price of copper.
Financial shares were also weaker, with ANZ and Westpac both declining 0.7% and National Australia Bank falling 0.2%.
Leighton Holdings lost 4.6%, building on Thursday's 10% dive following critical local newspaper reports.
Several gold stocks bucked the trend, rising as the price of the precious metal held above US$1,300 an ounce as the
U.S. government shutdown entered a fourth day. Norton Gold Fields advanced 7.7%, Kingsrose Mining rose 3.8% and Alacer
Gold added 0.7%.
Iluka Resources added 2.7%, helped by RBC lifting its stance on the shares to outperform from sector perform.
The market will be open Monday although it is a public holiday in New South Wales, Queensland and South Australia
"Many traders will be taking an extended break next week, so there have been a few traders happy to square off
positions ahead of the weekend," said Chris Weston, chief market strategist at IG in Melbourne.
Write to Robb M. Stewart at email@example.com
(END) Dow Jones Newswires
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