Aussie stocks close over 2pc down

SYDNEY - The Australian share market closed sharply lower on Monday following big falls in commodity prices and Wall Street.

The broad-based decline was led by financial and resources stocks and came amid the listing of department store chain Myer Holdings Ltd, which opened at $3.88 - 5.4 per cent lower than its $4.10 issue price.

The benchmark S&P/ASX200 index closed down 102.8 points, or 2.21 per cent at 4,540.4 points, while the broader All Ordinaries index slipped 100.6 points, or 2.16 per cent, to 4,546.3 points.

On the Sydney Futures Exchange at 1618 AEDT, the December share price index contract was down 83 points at 4,541 on a volume of 36,396 contracts.

The local stock market opened the trading day 2.69 per cent weaker after sharp falls on Wall Street on Friday night.

Although the local bourse managed to pare back some of its early losses during the day, both major indices drifted lower towards the close of trade.

Burrell Stockbroking director Richard Herring said banking and resources stocks, with the exception of Woodside, dragged the market lower on Monday.

"There's not much for the market to hang its hat on today, unfortunately," Mr Herring said.

"It is two per cent down across the board and pretty consistent through most sectors.

"It's really been fairly consistent selling most of the day, on OK volume."

Woodside Petroleum said it would sell its stake in the Otway Gas Project to joint venture partner Origin Energy for $712.5 million.

Woodside shares closed up 54 cents at $48.24.

Origin Energy ended down 11 cents at $15.96.

"Probably Woodside is the standout on the day, up after that announcement," Mr Herring said.

In other news on Monday, department store Myer returned to the Australian share market but was caught up the general sell-off.

Myer began trading at 1200 AEDT at $4.10 a share, but by the close had shed 35 cents, or 8.54 per cent, at $3.75.

At 1636 AEDT Myer was the top-traded stock by volume, with 130 million shares worth $500.64 million changing hands.

Rival department store David Jones backpedalled 11 cents to $5.25.

Other retailing stocks also sold off - Woolworths slipped 38 cents to $28.25, JB Hi-Fi declined 50 cents to $20.30 and Wesfarmers was down 89 cents to $27.20.

Financial stocks finished lower.

NAB ended down 95 cents, or 3.18 per cent, at $28.90, after it announced that it had completed the purchase of 80.1 per cent of Goldman Sachs JBWere's private wealth management business in Australia and New Zealand.

Among the other major banks, Westpac lost 78 cents, or 2.96 per cent, to $25.59, Commonwealth Bank finished $1.34, or 2.56 per cent lower, at $50.91, and ANZ Banking Group was down 47 cents, or 2.04 per cent, at $22.59.

Macquarie Group was down $2.45, or 4.90 per cent, at $47.55.

Mining giant BHP Billiton declined 74 cents, or 1.98 per cent, to $36.71, while Rio Tinto had fallen 99 cents, or 1.55 per cent, to $62.79 by the end of the session.

In other news on Monday, the federal government released its latest set of forecasts, including a lowering of its estimate for the peak unemployment rate.

Mr Herring said the more positive outlook was welcome but did little to stem the selling on the stock market.

"On a day like today, it was not going to change the end result dramatically," Mr Herring said.

"As a country we may feel better about it but as a sharemarket on the day, I don't think it has a great deal of impact."

The nation's largest beef cattle producer, Australian Agricultural Company Ltd (AAco), said the rising local currency had dented overseas demand and put a forecast second half profit at risk.

AAco ended steady at $1.455.

At 1635 AEDT the spot price of gold in Sydney was trading at US$1,045.20 per fine ounce, down US$3.82 from Friday's close of US$1,049.02 per ounce.

Lihir, which went ex dividend, was down one cent at $3.04 and Newcrest Mining was down 18 cents at $32.12, and Newmont Mining rose 10 cents to $4.85.

Preliminary national turnover was 2.48 billion shares worth $4.89 billion, with 237 stocks up, 928 down and 292 unchanged.

- AAP