Reuters: Hot Stocks: Australia shares fall 0.4 pct; Fairfax, Sundance jump

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Australia shares fall 0.4 pct; Fairfax, Sundance jump Dec 31st 2012, 00:48 Tweet Share this Email Print Sun Dec 30, 2012 7:48pm EST (Adds details, comments, stocks on the move) SYDNEY, Dec 31 (Reuters) - Australian shares fell 0.4 percent in a shortened session on Monday ahead of the New Year's Day holiday, with big miners and banks losing ground as investors awaited the outcome of U.S. budget talks. The Australian market has risen 14.7 percent in 2012, although it lost steam on the last day of the year with all eyes on the U.S. fiscal deal. A total of $600 billion in tax hikes and automatic cuts to government spending will start kicking in on Tuesday - New Year's Day - if U.S. politicians cannot reach a deal. Economists fear the measures will push the U.S. economy into a recession. "I imagine some deal will be done, but the problem will be the impact on confidence," said Damien Boey, an equity strategist at Credit Suisse. The benchmark S&P/ASX 200 index fell 19.4 points to 4,651.9 at 0028 GMT. It rose 0.5 percent to 4,671.3 on Friday, its highest close since June 2, 2011. Although iron ore prices had jumped to seven-month high, a weaker U.S. economy could bite into the gains in commodities, Boey added. "If you've got a weaker American economy because taxes have gone up and confidence is down, what you will find is that the key driver of commodities prices, which is the Chinese economy, will not actually be able to sustain strong growth," he said. Among the top miners, BHP Billiton Ltd lost 0.5 percent and Rio Tinto Ltd was down 0.7 percent. Major banks all traded lower, led by a 0.8 drop in Westpac Banking Corp. New Zealand's benchmark NZX 50 index fell 0.4 percent to 4,066.5. It has risen 24.2 percent for the year. Both the Australian and New Zealand markets will have shortened sessions on New Year's Eve. STOCKS ON THE MOVE * Shares in Fairfax Media Ltd jumped 5.7 percent after a consortium of allies of shareholder Gina Rinehart purchased a small holding to add to the mining mogul's stake. (0030 GMT) * Sundance Resources Ltd soared 17.2 percent after media reports said China's Hanlong Group would finalise its takeover by March 1. (0030 GMT) (Reporting by Maggie Lu Yueyang; Editing by John Mair and Ryan Woo) Tweet this Link this Share this Digg this Email Reprints Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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