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Aust shares fall ahead of US rate decision

Lilly Vitorovich
Australian shares are lower as investors await the US Federal Reserve's next interest rate decision

The Australian share market has opened lower, hurt by financial, material and energy stocks following mixed leads from offshore and as investors await the outcome of the US Federal Reserve meeting.

The benchmark S&P/ASX200 was down 7.4 points, or 0.12 per cent, at 6,047 points at 1030 AEST, while the broader All Ordinaries index was down 6.9 points, or 0.11 per cent, at 6,157.9 points.

Shaw and Partners senior private client adviser Craig Sidney says investors are concerned about the banking sector's future credit growth.

"There's just concerns with regards to the banks about the housing market and, probably more so, the credit growth going forward," Mr Sidney said.

National Australia Bank has dropped 0.42 per cent to $26.23, Commonwealth Bank has fallen 0.13 per cent to $68.76 and ANZ has lost 0.04 per cent to $26.55. But Westpac has bucked the trend, lifting 0.4 per cent to $27.62.

BHP Billiton and Rio Tinto have both dropped - 0.47 per cent to $33.53 and 0.33 per cent to $84.81, respectively - following falls offshore, Mr Sidney said.

A stronger US dollar weighed on copper prices, hitting major miners especially in the UK trading session where both companies are dual-listed.

In the US, the S&P 500 closed up 0.17 per cent, the Nasdaq Composite added 0.57 per cent and hit an all-time high, while the Dow Jones Industrial Average fell 0.01 per cent following the denuclearisation deal struck between the US and North Korea.

Meanwhile, the US central bank is expected to lift its key interest rate on Thursday but the accompanying statement could be more influential, according to CMC Markets chief markets strategist Michael McCarthy.

"Market pricing indicates traders are split between a total of three or four interest rate rises this year, and any shift in this perception will echo through global markets," he said in a note.

The Bank of Japan and the European Central Bank also have meetings this week.

Locally, Atlas Iron shares have jumped 5.95 per cent to $4.45 following media reports that Gina Rinehart's Hancock Prospecting has bought a significant stake in the Pilbara miner, just days after a similar move by Andrew Forrest's Fortescue Metals Group.

"I guess they're looking at the underlying assets of Atlas, probably more importantly the port access so that would be beneficial for both those companies," Mr Sidney said.

Meanwhile, the Australian dollar is again below 76 US cents after the greenback strengthened on reports Fed chair Jerome Powell was considering holding press conferences after every meeting, rather than after only quarterly meetings.

The local currency was trading at 75.74 US cents at 1030 AEST on Wednesday, from 76.10 US cents on Tuesday.

ON THE ASX AT 1030 AEST:

* The benchmark S&P/ASX200 was down 7.4 points, or 0.12 per cent, at 6,047 points

* The broader All Ordinaries index was down 6.9 points, or 0.11 per cent, at 6,157.9 points

* The SPI200 futures contract was up 4 points, or 0.07 per cent, at 6,059 points

* National turnover was 850.786 million securities traded worth $654.435 million