Australian markets

The Australian share market closed flat despite investors being buoyed by the central bank's largely unchanged outlook for the domestic economy. At the benchmark S&P/ASX200 index was down 2.8 points, or 0.06 per cent, at 4,566.3, and the broader All Ordinaries index was down 7.6 points, or 0.16 per cent, at 4,641.1.

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On the ASX 24, the June share price index futures contract was four points lower at 4,565, with 33,267 contracts traded. The Reserve Bank of Australia (RBA) left the cash rate at 4.75 per cent, the same level as it has been since November, and the accompanying statement featured only slight changes from the previous month. Bank shares led the afternoon gains, recovering from early losses that followed a bad session for financials in the United States. Westpac gained 17 cents to $21.52, ANZ added eight cents to $21.33, Commonwealth Bank edged up five cents to $49.73 and National Australia Bank was one cent higher at $24.44.

Defensive stocks posted gains, led by Telstra, which added six cents, or two per cent, to $3.08. In the consumer staples sector, grocery wholesaler Metcash reported a six per cent rise in annual profit but offered a sober assessment of the coming months. Its shares gained two cent to $3.90. Among others, Woolworths rose by five cents to $26.82 and Coles owner Wesfarmers was up 11 cents at $31.82. Materials stocks lost ground but recovered some of their earlier losses. BHP Billiton lost four cents to $42.96, Rio Tinto dropped six cents to $79.29, while Woodside Petroleum shed 54 cents to $45.05. Preliminary national turnover was 2.11 billion shares, worth $4.73 billion, with 349 stocks up, 730 down and 425 unchanged.

The Australian dollar slid in Asian trading Tuesday, weighed down by the Reserve Bank of Australia's decision to keep interest rates on hold. Australian bonds rallied on the decision, and particularly the accompanying policy statement, which traders said wasn't nearly as hawkish as some had expected. After trading in a tight range for much of the session, the Australian dollar slid rapidly in the early afternoon after Australia's central bank, responding to signs of a weakening economy, kept rates on hold at 4.75%. At the same time, the bank signaled wider concerns over global growth. The Australian dollar was changing hands at $1.0689, down from above $1.0740 before the decision and $1.0736 late Monday. Against the Japanese yen, the Australian dollar was at 85.855, down from 86.21.

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