Aussie & NZ dollars softer on stocks, China

SYDNEY/WELLINGTON: The Australian and New Zealand dollars drifted lower on Wednesday, weighed by a softer tone in stocks and commodities, as investors turned cautious after Slovakia rejected a first vote to expand the euro zone rescue fund.

Aussie eases to $0.9876, from $0.9953 in New York, having failed to hold near parity levels of Tuesday following a risk rally.

It breached the 20-day MA support at $0.9890 and looks set to test $0.9868, the 23.6 pct retracement of the $0.9388-$1.0016 move. Stiff resistance at the broken trend line on its weekly charts around $1.0010-30.

Still, the Aussie up 5 pct since hitting a 13-month low of $0.9388 last week on global gloom.

NZ dollar gives further ground slipping to $0.7751 just above its overnight low. It had hit a two-week high of $0.7857 on Tuesday.

Kiwi support at $0.7715 and below that $0.7670, with $0.7840 the first hurdle higher.

Risk sentiment tainted following disappointing earnings from Alcoa. Asian stocks in the red with S&P futures down 0.6 pct. Copper falls 1.5 pct.

Risk assets were already subdued after Slovakia rejected a plan to expand the euro zone rescue fund, though it is expected to pass later in the week.

A higher than anticipated USD/Yuan fixing, pushed the greenback up across the board, and particularly on Asian currencies. The Aussie is often taken as a proxy for regional emerging currencies.

Australian consumer confidence edged up further in October, with optimism about the economic outlook balanced somewhat by caution on making major purchases, a closely watched survey showed Wednesday.

Aussie dips to $1.2730 against the kiwi, after grinding up to a five-week high NZ$1.2775.

NZ housing data shows some tentative signs of life in the housing market, with prices nudging higher, more houses being sold, and changing hands more quickly. But the market remains at low levels and analysts saw no reason for the central bank to change its rates view. See

NZ government debt tracks Treasuries lower, sending local yields up to 2.5 basis points higher.

Australian debt gains, with three-year futures contract up 0.03 points to 96.310 and the 10-year 0.015 points higher to 95.655.