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Australia shares drop on poor earnings, U.S. sell-off; NZ flat

Published 28/02/2018, 12:47 pm
© Reuters.  Australia shares drop on poor earnings, U.S. sell-off; NZ flat
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By Susan Mathew

Feb 28 (Reuters) - Australian shares dropped on Wednesday after five sessions of gains, nudged down by a sell-off in U.S. markets, some poor company results at home and a fall in some commodity prices.

The S&P/ASX 200 index .AXJO was down 19.7 points, or 0.3 percent, at 6,037.2 by 0100 GMT.

"The selling that we saw in U.S markets began after Powell's comments ... and that negative momentum is spilling over into the region," said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

U.S. stocks fell on Tuesday as comments from Federal Reserve chair Jerome Powell spurred talk the central bank might squeeze in four rate hikes this year instead of the expected three. .N

In Australia, shares in mining giant BHP BHP.AX fell 1.5 percent amid a decline in prices for commodities such as oil, iron ore and copper. O/R IRONORE/ MET/L

Its a "perfect storm" for Australia today, said McCarthy, with some poor earnings by companies that reported on Wednesday also adding to broad declines.

Australia's biggest electronics retailer Harvey Norman Holdings Ltd HVN.AX was the worst performer on the index, down nearly 15 percent to its lowest in three months after its headline profit number for the first-half fell over 19 percent. main concern is around the headline profit number that came as a shock, and the reaction we're seeing represents a possible downgrading of Harvey Norman against its peers," said McCarthy.

Cement producer Adelaide Brighton Ltd ABC.AX dropped 6.4 percent after its annual net profit fell on expenses related to debt charges. Bank of Australia CBA.AX was also among the biggest drags on the index, down as much as 0.8 percent, its steepest intraday fall in two weeks.

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Hospital operator Ramsay Health Care RHC.AX declined 4.3 percent after reporting a fall in half-year profit.

"As the rest of the region comes online we could see some further pressure on the market" McCarthy added.

Meanwhile, New Zealand's benchmark S&P/NZX 50 index .NZ50 was flat at 8,363.4, down 3.02 points.

An 8.4-percent rise in Synlait Milk SML.NZ was outweighed by Sky Network Television's SKT.NZ drop of as much as 10.4 percent after it flagged shrinking subscribers in its first-half results amid stiff online competition from Netflix NFLX.O and Amazon.com Inc AMZN.O more individual stocks activity click on STXBZ

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