Finance stocks pull Oz market down

File photo / NZ Herald

PERTH - The Australian sharemarket closed in the red after financial stocks fell following the Federal Treasurer's pledge to release banking competition measures within the next week.

The benchmark S&P/ASX200 index was down 26.9 points, or 0.57 per cent, at 4699.9 points, while the broader All Ordinaries index fell 24.3 points, or 0.5 per cent, to 4791.7 points.

CommSec market analyst Juliette Saly said the local market held fairly steady in morning trade but financial stocks were sold off in the afternoon after Wayne Swan indicated the sector would be reformed within one week.

ANZ was down 34c, or 1.45 per cent, at A$23.15. The bank said it expected its funding costs would continue rising - putting its margins under pressure - as it replaced pre-crisis debt at higher post-crisis prices.

Westpac was down 18c at A$21.76, National Australia Bank shed 34c, or A1.42 per cent, to A$23.62 and Commonwealth Bank backtracked 16c to A$49.60.

"Rio Tinto is managing to hold its head above water but only just, due to stronger trade in London on the metals exchange overnight," Saly said.

Rio Tinto was up 17c at A$87.51 but BHP Billiton gave up 22c to A$44.86.

- AAP