Reuters: Hot Stocks: Australia shares slip ahead of RBA meeting, Billabong dives

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Australia shares slip ahead of RBA meeting, Billabong dives Jun 4th 2013, 01:33 Mon Jun 3, 2013 9:33pm EDT (Adds details, comments, stocks on the move) SYDNEY, June 4 (Reuters) - Australian shares fell 0.4 percent on Tuesday to four-month lows as losses in financial stocks offset modest gains in miners amid subdued activity ahead of the outcome of the Reserve Bank of Australia's policy meeting later in the day. Banks were weaker, Westpac Banking Corp fell 0.6 percent while top lender the Commonwealth Bank of Australia fell 0.5 percent. "Again it comes into the rotation play. The banks are the ones dragging the market lower," said Evan Lucas, market strategist at IG. "The rotation is on - high yielding stocks out, and materials, cyclical plays are back up." Rio Tinto rose 1.4 percent after copper climbed on Monday to a more than one-week high and BHP Billiton Ltd edged up 0.3 percent. Iluka Resources Ltd jumped 1.9 percent. The S&P/ASX 200 index lost 23.1 points to trade at 4,865.2, its lowest point since Jan. 29 by 0106 GMT. The benchmark fell 0.8 percent on Monday, hurt by weak factory activity data in China, Australi's major export market. The benchmark has recently been hit by concerns over slowing growth in China, jitters the Federal Reserve will wind back its stimulus this year and volatitlity in Japanese equities. While the Fed stimulus jitters have eased somewhat, uncertainty over when the central bank may roll back the bond-buying scheme continues to buffet markets. Billabong International Ltd dived 57.1 percent to all time lows of A$0.20. The Australian surfwear company said on Tuesday it had ended its takeover talks with two potential suitors and was now discussing refinancing options instead, as it warned that full-year profit would sink below previous guidance. "They are now in the situation where they are going to have to be completely refinancing - that will obviously dilute their share price and dilute any form of debt that they've already got," Lucas said. Elsewhere, high yielding defensives lost ground. Flagship telecommunications provider Telstra Ltd slipped 0.3 percent while consumer retailer Woolworths Ltd was down 0.8 percent. U.S. stocks rose on Monday as weaker-than-expected factory activity supported views the Federal Reserve will keep economic stimulus in place. The Reserve Bank of Australia holds its monthly policy meeting later on Tuesday and has been expected to keep rates at 2.75 percent following a quarter-point cut in May. Markets are still only pricing in a minor 16 percent chance of a move, with the decision due at 0430 GMT. New Zealand's benchmark NZX 50 index slipped 0.2 percent or 7 points to 4,504.4. STOCKS ON THE MOVE * Ten Network Holdings Ltd rallied 1.7 percent to A$0.295 after the television station signed an agreement with cricket Australia for exclusive broadcasting rights. (0104 GMT) * Teranga Gold Coporation soared 5.7 percent to A$0.74 after announcing its intention to acquire Oromin. (0103 GMT) * Coal of Africa dived 10 percent to A$0.18 after putting forward a new proposal in efforts to improve productivity. The decision follows sustained attempts over the past two financial years to make operations profitable. (0104 GMT) (Reporting by Thuy Ong; Editing by Jacqueline Wong) Link this Share this Digg this Email Reprints

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