The highest unemployment rate in more than 12 years has dented the share market, with concerns about a slowing economy hitting the banks.
The market dropped after the release of official figures showing a jobless rate in January of 6.4 per cent, up from 6.1 per cent in December.
“You have increased unemployment, you have increased chance of bad debt,” Patersons Securities economist Tony Farnham said.
“With slower lending growth, you have a degree of pressure put on bank profits and with that, a degree of pressure put on dividends.
“If the dividend story is no longer as enticing, you’re going to get people saying, `At these prices, do they represent value?’.”
Commonwealth Bank shed 68 cents to $91.18, National Bank fell 35 cents to $36.71, ANZ dropped 11 cents to $34.98 and Westpac was 14 cents weaker at $36.69.
Other financials also suffered, with Macquarie Group losing $1.58, or 2.3 per cent, to $65.83.
An International Energy Agency report suggesting a slow recovery in crude oil prices hit energy stocks.
Santos dropped 12 cents to $7.59 after also announcing a $1.6 billion writedown due to the oil price slide, while Woodside shed 32 cents to $33.84 and Oil Search was two cents weaker at $7.99.
Telstra shares fell four cents to $6.45 after reporting a 22 per cent lift in half year profit to a record $2.1 billion.
Rio Tinto was up 10 cents at $59.90 ahead of its annual results announcement late on Thursday, while BHP Billiton lost 27 cents to $30.70 and Fortescue Metals was flat at $2.45.
KEY FACTS
* At the close on Thursday, the benchmark S&P/ASX200 index was down 25.5 points, or 0.44 per cent, at 5,743.6.
* The broader All Ordinaries index was down 24 points, or 0.42 per cent, at 5,707.7.
* The March share price index futures contract was down 30 points at 5,693 with 25,945 contracts traded.
* National turnover was 1.8 billion securities worth $5.8 billion.
