Australian shares have suffered their heaviest daily fall in almost two months as nervous investors sold out due to a political impasse in the United States.
But analysts say the falls are not worrying, as the three months to the end of September were the best quarter for the local market since 2009.
CommSec analyst Juliette Saly said Monday’s fall was exacerbated by many local investors finalising trades for the end of the September quarter.
“Not only is it the end of the month and the end of the quarter but we’ve still got this unresolved debt issue in the US so there’s just a little bit of nervousness coming through,” Ms Saly said.
US lawmakers have one final day to try to prevent the first US government shutdown in 17 years, but a deal ahead of the budget deadline is remote.
“We had a great run at the end of last week, with a five year high, now we’re just seeing a little bit of consolidation, but today’s not a day to be all panicked and worried,” Ms Saly said.
All of the big miners took a hit, with BHP Billiton down 62 cents at $35.74, Rio Tinto off $1.55 at $61.74 and Fortescue Metals 19 cents lower at $4.75.
But copper miner OZ Minerals was up two cents at $4.43, due to reports mining giant Glencore Xstrata was considering a takeover bid.
OZ Minerals has said it has not received any offer from Glencore Xstrata.
Gold miner Newcrest gained 23 cents to $11.70.
Among the big banks, ANZ fell 74 cents to $30.78, Commonwealth was down $1.95 to $71.21, Westpac was 57 cents lower at $32.73 and National Australia Bank dropped 79 cents to $34.32.
Among the few companies to rise was Westfield, up eight cents at $11.01.
KEY FACTS
* At the close on Monday, the benchmark S&P/ASX200 index was down 88.2 points, or 1.66 per cent, at 5,218.9 points.
* The broader All Ordinaries index was down 84.6 points, or 1.6 per cent, at 5,217.7.
* The December share price index futures contract was 92 points lower at 5,217, with 28,191 contracts traded.
* National turnover was 1.7 billion securities worth $4.0 billion.