Miners drag ASX down

File photo / AP

The Australian sharemarket was dragged into the red by mining stocks yesterday amid concerns about potential cooling of China's economy after its Government tightened monetary policy.

The benchmark S&P/ASX200 index fell by 38.4 points, or 0.8 per cent, to 4763.1, while the broader All Ordinaries index shed 36 points, or 0.73 per cent, to 4872.6 points.

On the ASX 24, the March share price index futures contract was down 46 points at 4744 points, with 24,863 contracts traded.

CommSec market analyst Juliette Saly said floods in Queensland, Victoria and NSW hampered insurance stocks, but miners were the biggest weight on the market after the Chinese Government's surprise decision to increase the deposit rates among banks.

Saly said there were fears that a slowing of China's economy would dent demand for resources.

Among miners hit by the floods Macarthur Coal was a poor performer, falling A21c, or 1.53 per cent, to A$13.50.

"Most of them are coming back, though," Saly said.

Diversified conglomerate Wesfarmers, which runs Queensland's Curragh coal mine, was up A6c at A$32.48. BHP Billiton was down A55c, or 1.2 per cent, at A$45.30 and Rio Tinto fell A$1.65, or 1.89 per cent, to A$85.88.

Saly said the market awaited an update from Insurance Australia Group (IAG) and Suncorp Group on the estimated cost of the flood damage.

Suncorp, which has been sold off in recent weeks and is the insurer with the largest exposure to Queensland, was down A20c, or 2.38 per cent, at A$8.20.

IAG backtracked A4c, or 1.05 per cent, to A$3.77 while QBE Insurance Group fell A11c to A$18.10.

Woolworths finished A15c firmer at A$27.78.

National Australia Bank fell A21c to A$24.16, ANZ was A34c lower at A$22.71, Westpac eased A29c to A$22.20 and Commonwealth Bank was A41c softer at A$51.00 but Bank of Queensland rose A1c to A$9.85.

Saly said energy stocks were mixed after the oil price rose to 27-month highs. Woodside was down A42c at A$42.97, Oil Search was up A3c at A$6.91 and Santos rose A8c to A$13.85. Caltex was down A29c, or 2.06 per cent, at A$13.82 after the Queensland floods forced it to close one of its main refineries in Brisbane last week.

Making headlines on Monday, AMP's A$14.6 billion takeover of AXA Asia Pacific Holdings has been deemed fair and reasonable by AXA APH's independent expert. Shares in AMP were steady at A$5.18 while AXA shares inched A1c higher to A$6.40.

A South Australian court has denied Straits Resources and its joint-venture partner Argonaut Resources the right to explore a region around Lake Torrens. Shares in Straits were steady at A$2.37 while Argonaut shares plunged A5c, or 27.03 per cent, to A13.5c.

- AAP