SYDNEY: Australian shares were flat on Wednesday, with miners holding the market back as investors sold out of stocks dependent on global growth.
Volumes continued to thin out leading up to Christmas, not helped by weeks of gyrations on hopes that Europe would stabilise its debt woes and disappointment after every new plan.
"People have given up. There's been so many false starts and so many head fakes this year, people have put the cue in the rack," said Cameron Peacock, an analyst at broker IG Markets.
Two of the big four banks fell after No.3 lender Westpac Banking Corp warned at its annual meeting that margins were under pressure from higher funding costs.
Westpac dropped 1.4 percent to A$20.54, while Commonwealth Bank of Australia fell 0.7 percent. National Australia Bank, which holds its shareholder meeting on Thursday, was flat.
Australia and New Zealand Banking Group, with an annual meeting on Friday, rose 0.9 percent. The No.4 lender is seen as the least vulnerable to higher funding costs as it has a growing deposit base in Asia as a source of funds.
The benchmark S&P/ASX 200 index recouped early losses to inch up 1.7 points to 4,195.1 as of 0243 GMT, after a 1.4 percent drop on Tuesday.
New Zealand's benchmark NZX 50 index fell 11.2 points to 3,281.6.
STOCKS ON THE MOVE
Rio Tinto bucked the falls in mining stocks, climbing 44 cents after it won a ruling on Tuesday clearing the way for it to grab majority control of Ivanhoe Mines.
Ivanhoe's shares plunged 20 percent on the ruling against its "poison pill" as the Canadian company's founder Robert Friedland will now find it tough to line up a counter bidder against Rio Tinto.
Junior oil producer Neon Energy jumped 7.6 percent to a four-year high of A$0.575 on more than double its normal volume, as investors bet on a possible farm-out deal on the company's oil and gas blocks in Vietnam and drilling results due from California.
Hastings Diversified Utilities Fund jumped 9 percent to a record high of A$1.93 after receiving a takeover offer from rival APA Group. The rise put its shares 2 percent below the value of the offer of cash and scrip, indicating investors expect the deal to go ahead.
APA shares fell 3.6 percent to A$4.435.
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