The Australian share market is trading lower, weighed down by weakness in the big banks.
HC Securities senior client adviser Mark Lennox said the banks were lower because investors had already factored in the probability of another interest rate cut by the Reserve Bank of Australia, which would benefit the banks.
“Speculators and investors who have been investing in the banks are now thinking how much higher can these valuations (of the banks) go,” he said.
Mr Lennox said the resources sector was benefiting from higher iron ore and oil prices.
Mr Lennox said afternoon trade would largely depend upon Chinese GDP and production figures.
Official figures out of China just after noon AEST showed that its economy expanded seven per cent year-on-year in the first quarter, slumping to a new post-global financial crisis low.
On the local bourse among the major banks at 1201 AEST, ANZ had fallen 34 cents to $35.98, Commonwealth Bank was off $1.13 at $92.67, National Australia Bank had shed 45 cents to $38.98, and Westpac had retreated 65 cents to $38.91.
A recovery in iron ore prices to above $US50 a tonne overnight boosted the big miners.
BHP Billiton added 49 cents to $29.61, Rio Tinto gained $1.11 to $56.07, and Fortescue Metals firmed 3.75 cents to $1.8725.
Gold and copper miner PanAust was steady at $1.74 after it rejected a state-owned Chinese company’s $1.1 billion takeover bid.
The energy sector rose following a rise in crude oil prices for the fourth straight session.
Woodside Petroleum lifted 35 cents to $35.60 despite its sales revenue declining by 20 per cent to $1.4 billion in the March quarter.
Santos was up 11 cents at $7.80.
Lend Lease backtracked 17 cents to $17.02 despite the engineering construction group saying the Victorian government’s decision to scrap the East West Link road tunnel project wouldn’t cause a major hit to earnings.
KEY FACTS
* At 1206 AEST on Wednesday, the benchmark S&P/ASX200 index was down 38.2 points, or 0.64 per cent, at 5,908.4 points.
* The broader All Ordinaries index was down 37.4 points, or 0.63 per cent, at 5,878.8 points.
* The June share price index futures contract was down 41 points at 5,897 points, with 16,343 contracts traded.
* National turnover was 648.4 million securities worth $1.94 billion.
