Australian shares fell by 0.5% for the fourth consecutive day as credit market worries continue to grip investor sentiment.
Nevertheless sentiment was up slightly, as the market recovered some of the losses from this morning’s lows.
While the Australian central bank raised interest rates to a 12-year high of 7.25%, as widely expected, comments from Governor Glenn Stevens suggested that the central bank would not raise rates again soon.
The benchmark S&P/ASX 200 index fell 25.5 points to 5,380.3, based on the latest available data, after falling a total of 6.3% in the previous three sessions.
The index has now fallen 15.1% since the start of the year after rising 11.8 percent in 2007.
The All Ordinaries lost 31.5 points to close down at 5,479.20.
The Reserve Bank revealed this afternoon that the board had decided to boost the cash rate by 0.25% for the second month in a row, “to contain and reduce inflation over the medium term”.
The banking sector mostly rebounded, with National Australia Bank rising 1.2% to $27.50 and ANZ up 2.4% to $21.44.
On the upside, David Jones jumped 3.3% to $4.02 after it announced plans to cut costs and open new stores to ensure profit after tax growth of at least 5-10% a year, after the ABS revealed today that retail growth was flat for January.
Gold was down a little on yesterday, with Comex Gold hitting $982.70 an ounce at 4.55PM AEST.
