ASX closes lower as miners, telcos slip
The Australian share market has given up its early gains to close lower, dragged down by the big miners and the telecommunications sector.
The benchmark S&P/ASX200 index finished down 23.1 points, or 0.35 per cent, to 6,530.9 points at 1615 AEST on Monday, while the broader All Ordinaries was down 24.2 points, or 0.36 per cent, to 6,609.4.
"A bit of deterioration coming in in the afternoon," Bell Direct equities analyst Julia Lee said.
Telecommunications shares slid 2.3 per cent after AGL Energy said it was abandoning its $3 billion takeover bid for internet provider Vocus, its second tilt at the owner of the iPrimus and Dodo brands.
Vocus shares were the worst-performing on the ASX200, crashing 24.5 per cent to a nearly six-month low of $3.29, while AGL shares gained 1.6 per cent to $19.88.
Sector heavyweight Telstra was down 1.8 per cent to $3.80.
The mining sector was down one per cent as a whole as the price of iron ore retreated, with mining giant BHP down 0.4 per cent to $40.16, Fortescue Metals down 3.8 per cent to $8.47 and Rio Tinto down 1.4 per cent to $103.86.
Pilbara Minerals tumbled 9.9 per cent to 63.5 cents after it said it would slow down production at its lithium mine in Pilgangoora, WA, until the end of July because two key customers in China were facing delays in getting chemical conversion plants ready.
Fleet management and salary packaging McMillan Shakespeare shares fell 4.9 per cent after it said its profit would be below expectations and it would take a $3.7 million hit because of poor asset management by its UK division.
A large customer went into administration and returned many vehicles prematurely and their contracts lacked the customary break fee, McMillan said.
Most of the big banks were up, with Commonwealth gaining 0.5 per cent to $80.19, Westpac up 0.4 per cent to $27.98 and ANZ up 0.2 per cent to $28.28 even as New Zealand chief executive David Hisco left after an internal review flagged he had sought reimbursement for chauffeur-driven cars and wine storage.
NAB was the outlier, falling 0.3 per cent to $26.66.
Afterpay Touch was down for third consecutive day, falling 6.1 per cent to a nearly three-month low of $20.27, following last week's announcement the buy now, pay later company faced an audit over its compliance with a 2006 money-laundering law.
Skin disorder drug company Clinuvel Pharmaceuticals, network service provider Service Stream and shipbuilder Austal were all up following Friday's announcement they would be joining the ASX200 next Monday as part of its quarterly rebalancing, replacing Seven West Media, Syrah Resources and Navitas.
Clinuvel gained seven per cent, Austal was up 3.6 per cent and Service Stream gained 2.8 per cent.
Ms Lee noted that index fund managers would have to buy shares of the companies as they sought to mirror the performance of the ASX200.
The Aussie dollar is buying 68.74 US cents, from 69.02 US cents on Friday.
Looking forward, the US Federal Open Market Committee (FOMC) is holding a two-day meeting beginning Tuesday (US time), followed by a press conference on Wednesday.
Traders will be watching closely to see if Federal Reserve Chairman Jerome Powell hints at a rate cut in July and deletes the "dot plots" signalling a rate hike in 2020, Ms Lee said.
ON THE ASX:
* The benchmark S&P/ASX200 index was down 23.1 points, or 0.35 per cent, to 6,530.9 points at 1630 AEST on Monday.
* The All Ordinaries was down 24.2 points, or 0.36 per cent, to 6,609.4.
* At 1630 AEST, the SPI200 futures index was flat at 6,541.
CURRENCY SNAPSHOT AT 1630 AEST:
One Australian dollar buys:
* 68.74 US cents, from 69.02 US cents on Friday
* 74.64 Japanese yen, from 74.70 yen
* 61.29 euro cents, from 61.20 cents
* 54.62 British pence, from 54.50 pence
* 105.65 NZ cents, from 105.48 cents
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