Australia Markets open in 2 hrs 43 mins

Australian share market closes lower again

Stuart Condie

The Australian share market has closed lower, giving up most of last week's gains in a single session.

The benchmark S&P/ASX200 index closed Monday down 34.6 points, or 0.58 per cent, at 5,904.9 points, while the broader All Ordinaries was 0.61 per cent lower.

At 1630 AEDT, the SPI200 futures index was down 31 points, or 0.52 per cent, at 5,892, while the Australian dollar was buying 71.09 US cents, unchanged from Friday.

The federal government looks set for minority rule due to its apparent by-election loss at the weekend, but CommSec chief market analyst Steven Daghlian said the market dive was largely a result of international worries rather than domestic uncertainty.

"Things like the Wentworth by-election don't instil too much confidence in government overall, but it's certainly not the main reason (for the market to be down)," he said.

"Like we have been doing for a while now, it's looking to the US markets to gauge how were are doing and what is going to impact us, and also how US relations with other nations impact things."

Although AGMs, Reserve Bank pronouncements and resource production updates abound, Mr Daghlian said factors such as the US-China trade stand off plus looming oil sanctions on Iran were still the main drivers.

"(Today's losses) have been enough to reverse much of last week's improvement, and as there was no one real positive from last week driving the gains, what has been happening overseas is what has brought things down," he said.

With Rio Tinto and BHP shares rising 0.18 and 1.07 per cent respectively, the heavyweight materials sector held steady on Monday following improved copper prices.

But the big four banks all fell more than 0.7 per cent - with ANZ leading the declines with a 0.96 per cent drop to $25.79 - while the tech, health and consumer discretionary sectors also gave up more than one per cent each.

Flight Centre shares plummeted as much as 12 per cent - closing $5.11, or 9.98 per cent, lower at $46.08 - after the travel company flagged a lower first-half profit from its Australian business and warned rising oil prices could hit airfares.

But Virgin Australia offered a ray of light with a 2.44 per cent gain to 21 cents after saying it expects to lift first-half underlying pre-tax profit at least 22 per cent to about $100 million after a jump in first-quarter revenue.

Worley Parsons shares were in a trading halt, so investors will have to wait to pass judgment on the engineering group's $4.6 billion acquisition of Jacobs Engineering's energy, chemicals and resources division.

The deal, if it goes through, will almost double the ASX-listed firm's size.

ON THE ASX:

* The S&P/ASX200 closed down 34.6 points, or 0.58 per cent, at 5,904.9 points

* The All Ordinaries closed down 36.6 points, or 0.61 per cent, at 6,006.2 points

* At 1630 AEDT, the SPI200 futures index was down 31 points, or 0.52 per cent, at 5,892 points.

CURRENCY SNAPSHOT AT 1630 AEDT:

One Australian dollar buys:

* 71.09 US cents, from 71.09 US cents on Friday

* 80.07 Japanese yen, from 79.95

* 61.75 euro cents, from 62.04

* 54.40 British pence, from 54.59

* 107.86 NZ cents, from 108.33

GOLD:

The spot price of gold in Sydney at 1630 AEDT was $US1,228.00 per fine ounce, from $US1,227.35 on Friday.