News Service from House Harris

Aust shares close down with all sectors weaker

SYDNEY, Dec 11 AAP - The Australian share market closed about one per cent weaker with losses in most sectors as traders looked to make short-term gains.

The benchmark S&P/ASX200 index ended down 42.7 points, or 1.17 per cent, at 3,598, while the broader All Ordinaries fell 39.1 points, or 1.09 per cent, to 3,534.2.

On the Sydney Futures Exchange, the December share price index contract ended down 34 points at 3,587 on a volume of 28,351 contracts.

Burrell Stockbroking associate Peter Wright said the market was particularly hard to gauge with low trading volumes and expectations of more capital raising.

"I wouldn't read too much into it, I wouldn't be surprised if there is a fair proportion of short-selling and anticipatory selling looking at potential capital issue," Mr Wright said.

Rio Tinto shares gained $2.60, or 6.95 per cent, to $40.00 as investors reacted to its plans to slash jobs, cut spending and costs and sell assets in order to survive the global economic crisis.

BHP Billiton lost 16 cents to $30.20.

"It wouldn't surprise me too if there's an element of profit taking in some of this stuff," Mr Wright said of the major miners.

"A lot of people bought BHP under $25, and Rio around $30, and there are opportunities in this market for some short-term trading."

Among the banks, Westpac rose 18 cents to $16.55 after telling shareholders its balance sheet growth was set to slow over the coming year, with impairment charges rising as the economy slows.

Commonwealth Bank dropped 35 cents to $28.15, National Australia Bank fell 25 cents to $19.35 and ANZ rose 27 cents to $14.42.

Bank of Queensland shares lost two cents to $10.25 after it indicated it was to consider growth options including takeovers and alliances.

Among other news, media mogul Kerry Stokes has been elected chairman of West Australian Newspapers Holdings, while businessmen Don Voelte and Sam Walsh joined the board as independent directors.

WAN shares lost 21 cents, or 4.41 per cent, to $4.55.

Fairfax shares gained 1.5 cents to $1.52 as the market reacted to its decision to cut its dividend payout ratio to 20 per cent, from 80 per cent, in the first half of fiscal 2009.

Mining services provider Boart Longyear said it would cut 67 jobs in Adelaide as it continued its restructuring and consolidation of manufacturing in the Asia-Pacific Region.

Boart Longyear stocks added one cent to 24.5 cents.

National carrier Qantas Airways has been fined $20 million for price fixing in the airfreight market.

Qantas dropped four cents to $2.35, while rival Virgin Blue was flat at 28 cents.

Gold in Sydney closed at $US813.75 per fine ounce, up $US34.90 on Wednesday's close of $US778.85.

Gold stocks were mixed, with Lihir gaining nine cents to $2.35, Newmont adding 21 cents to $5.21, while Newcrest dropped $1.28 to $27.31.

In energy, Woodside dropped 93 cents to $32.77, Oil Search lost six cents to $4.70 and Santos added 90 cents to $14.80.

Retailers were lower, with Coles owner Wesfarmers down 58 cents at $15.77, Woolworths off 89 cents at $26.19 and David Jones 11 cents weaker at $2.90.

The most traded stock was Telstra with 36.7 million shares worth $153.3 million changing hands.

Telstra shares were down 13 cents, or 3.04 per cent, at $4.14.

Market turnover was 1.1 billion shares, worth $4.16 billion, with 344 stocks up, 551 down and 274 unchanged.