The Australian share market has closed lower amid weak prices for commodities, such as oil, and weak manufacturing data from China.
CMC Markets chief market analyst Ric Spooner said the key factor behind the market’s fall was weaker commodities prices.
“That’s seen the energy and materials sector lead the market down today,” Mr Spooner said.
“At this early stage, it appears that the rally that we saw in commodity prices last weak may have been pretty brief.”
Mr Spooner said another deterioration in manufacturing activity in China suggested soft demand for commodities.
The Caixin purchasing managers’ index, which was previously sponsored by HSBC, showed Chinese manufacturing weakened in July.
The index fell to a two-year low of 47.7 points from June’s 49.4 on a 100-point scale.
Looking ahead, Mr Spooner said Tuesday’s meeting of the Reserve Bank – after which the central bank is expected to hold interest rates steady – had the potential to move the market.
But a more likely driver would be the statement of monetary policy on Friday because it would give the market and insight into the RBA’s forecasts.
On the local bourse, global miner BHP Billiton was off 27 cents at $26.18, Rio Tinto reversed 66 cents to $52.20, but Fortescue Metals added 0.5 cents at $1.86.
Oil and gas producer Woodside Petroleum dropped 40 cents to $35.25, and Santos gave away six cents at $7.34.
Among the major banks, the Commonwealth Bank lost 19 cents at $87.37, National Australia Bank fell 18 cents to $34.59, ANZ was steady at $32.68, and Westpac eased one cent to $34.85.
Argo Investments improved one cent to $8.29 after unveiling a 16.5 per cent rise in annual net profit to a record $228.1 million.
Blood products and vaccines supplier CSL climbed to $99.90 during trading but closed 13 cents lower at $98.83.
KEY FACTS:
* At 1616 AEST on Monday, the benchmark S&P/ASX200 index was down 19.9 points, or 0.35 per cent, at 5,679.3 points.
* The broader All Ordinaries index was down 17.4 points, or 0.31 per cent, at 5,664.3 points.
* The September share price index futures contract was down 34 points at 5,617 with 17,505 contracts traded, according to preliminary calculations.
* National turnover was 1.47 billion securities worth $2.73 billion.
