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MELBOURNE - The Australian share market closed lower today as many investors sat on the sidelines, waiting to see if a US$700 billion (A$887 billion) bailout plan for the troubled US financial sector would make it all the way through the United States Congress.
The US Senate has
voted 74-25 in favour of the bailout package. It is hoped that the bailout will restore some calm to anxious global credit markets and stock markets worldwide.
But the package must still return to the lower house of the US Congress, the House of Representatives, which voted against an earlier version on Monday.
At the 1615 AEST close, the benchmark S&P/ASX200 index was down 33.5 points, or 0.7 per cent, at 4761.1, while the broader All Ordinaries index had fallen 40.4 points, or 0.84 per cent, to 4774.1.
The December share price index futures contract had lost 43 points to 4804, on a volume of 28,741 contracts, according to preliminary calculations.
CMC Markets head of trading James Foulsham said trading today on the local bourse had been relatively quiet, with the market drifting up and down.
"People are just hanging on the US decision," Mr Foulsham said.
"We saw some news on that this morning, but until we get a firmer view one way or the other, I think people are going to stay out of the market because it's too risky."
Mr Foulsham said that if the bailout package made it through the lower house of the US Congress, there was likely to be a rally on the Australian market.
But if the bailout package is rejected again, the market is likely to fall.
Mr Foulsham said global miners BHP Billiton and Rio Tinto were the biggest drag on the market today.
He said both stocks pulled back after surging yesterday, when Australia's competition watchdog said it would not oppose BHP's proposed US$120 billion (A$151.32 billion) takeover of Rio.
BHP Billiton fell $1.08 to $31.67.
Rio descended $3.75 to $91.25 as it said the market for its products remained robust despite the global financial crisis.
Zinc producer CBH Resources was up 0.6 cents at 7.9 cents as it launched a hostile $60 million takeover for Perilya just over two months after the companies terminated a friendly merger.
Perilya soared 4.5 cents to 31.5 cents.
Cape Lambert Iron Ore jumped 10.5 cents to 46 cents as its second largest shareholder, Power United, said removing the iron ore explorer's incumbent board was the only way to review its controversial decision to invest in a project in Sierra Leone.
Oil and gas producer Woodside Petroleum was off 72 cents at $51.48, and Santos declined 48 cents to $18.57.
In the banking sector, ANZ surrendered 32 cents to $18.98 as the chief of Australian operations, Brian Hartzer, said the bank intended on pass on as much of an expected cut in official interest rates as it can, given the current level of wholesale funding costs.
Commonwealth Bank picked up 54 cents to $45.40 as HBOS Australia declined to comment on speculation it was in talks with the big four bank about selling its BankWest arm.
National Australia Bank was steady at $25.70, and Westpac lifted 26 cents to $23.51.
On Wall Street overnight, the Dow Jones Industrial Average index dipped 19.59 points, or 0.18 per cent to 10,831.07.
In the gold sector, Newmont hovered at $4.88, Newcrest was 45 cents richer at $28.85, and Lihir firmed two cents to $2.77.
At 1630 AEST, the price of gold in Sydney was US$869.90 per fine ounce, down US$7.00 on yesterday's close of US$876.90.
Among the telcos, Telstra was 10 cents higher at $4.38, and Optus-owner Singapore Telecommunications improved six cents to $2.87.
In the media sector, News Corp sagged seven cents to $15.10 while its non-voting stock reversed five cents to $14.83.
Consolidated Media was off 24 cents at $2.26, and Fairfax gave away four cents to $2.58.
Retailer Woolworths was steady at $28.70, and Wesfarmers, which owns Coles, retreated 92 cents to $28.56.
Among other stocks, property developer Lend Lease Corp ascended 18 cents to $9.58 as it agreed to buy 41 per cent of listed retirement homes operator Babcock & Brown Communities (BBC) in a deal worth $236.8 million.
BBC was seven cents poorer at 40 cents.
Printer PMP eased three cents to $1.255 after it extended its printing contract with ACP Magazines on more favourable pricing terms and guaranteed volumes.
Insurer Tower Australia Group was off two cents as it said it would acquire the 85 per cent of InsuranceLine Holdings it does not already own for $136 million.
The top-traded stock by volume was Telstra, with 44.36 million shares worth $194 million changing hands.
Preliminary national turnover was 976.5 million shares worth $3.93 billion, with 590 stocks down, 400 up and 276 unchanged.
- AAP