Australian shares were lower at midday, extending losses through the morning in quiet conditions.

The benchmark S&P/ASX200 Index was 27.6 points, or 0.6 per cent lower at 4567.3 points. The broader All Ordinaries Index, meanwhile, had slumped 26.1 points, or 0.57 per cent, to 4589.5 points.

On a sector-by-sector basis, telecoms edged up 0.6 per cent following the Coalition's announcement of its broadband policy, and the rest were in the red. Materials was the worst performer, falling 1 per cent, followed by information technology and utilities, down 0.9 and 0.8 per cent, respectively.

On the Sydney Futures Exchange, the September share price index contract went down 20 points at 4539 points, with 12,723 contracts traded.

There were 13 shares declining for every 10 that had managed edging up at noon east-coast time.

Trading conditions were quiet ahead of important economic data from China and Commonwealth Bank's latest earnings report, due later in the week, said City Index market strategist Michael McCarthy. NAB's business confidence index dropped to a 14-month low.

Large institutional players mostly remained on the sidelines.

''Looking at the volumes, they are quite low so it suggests to me that the large players, the ones that really make a difference to the market, are largely absent,'' Mr McCarthy said.

He said that without involvement from the institutional players, the market was ''just reversing itself''.

Yesterday, the Australian bourse finished in positive territory amid solid gains in the materials sector, as well as energy and financial stocks.

The benchmark S&P/ASX200 index climbed 28.8 points or 0.63 per cent, to settle at 4,594.9 points. The broader All Ordinaries index ended 29.3 points or 0.64 per cent higher at 4,615.6 points.