SYDNEY: The Australian sharemarket opened little changed as strong gains in mining stocks were countered by significant weakness in the financial sector on the back of a poorer-than-expected first-half result from Westpac.
At the 10.15am (AEST) official market open, the benchmark /ASX200 index was down 2.2 points, or 0.04 per cent, at 5,812.2 points, while the broader All Ordinaries index edged up 0.4 of a point, or 0.01 per cent, to 5,799.2 points.
CMC chief market analyst Ric Spooner said while Westpac’s overall result was solid, the slight miss on expected cash earnings and the fact that it will raise capital to neutralise its dividend reinvestment policy comes against a background of relatively full valuations’ for bank stocks.
“This may see it struggle to hold value especially once it trades ex dividend,” he said.
“Whether this translates into rotation out of Westpac and into other banks, or simply nervousness about the whole sector, will be a key factor for the ASX 200 index which is heavily weighted towards bank stocks.”
Financial stocks weighed heavily on the market at the open, losing 1.23 per cent as a sector.
ANZ lost 1.96 per cent to $33.48, while Commonwealth Bank fell 1.66 per cent to $87.44.
