Australian shares finished lower on Tuesday, dragged down by weakness in financial stocks even amid a bounce in retail sales and as the Reserve Bank of Australia (RBA) held rates steady. The S&P/ASX 200 index ended down 0.2 percent, or 13.887 points to 5,971.70 at the close of trade. The benchmark closed 0.07 percent lower on Monday.
Australian retail sales bounced in October after months of lukewarm demand, a bright sign for spending in the upcoming holiday season as Amazon.com Inc opened its doors for business. The Australian central bank stood pat on policy, as expected, and kept its record low rate of 1.50 percent at its final meeting of the year as inflation remained sluggish.
Core inflation has undershot the RBA's 2-3 percent target for two years and is currently running at an average 1.85 percent. The 'Big Four' banks slid between 0.2 percent and 1.3 percent.
The Australian government is holding a wide-ranging inquiry into the scandal-hit finance sector, arguing one was needed to restore public confidence as it reversed its long-held opposition amid mounting political pressure. Materials were the second biggest losers on the index, with heavyweights BHP slipping 0.9 percent and Rio Tinto falling 2.1 percent. New Zealand's benchmark S&P/NZX 50 index fell 0.11 percent, or 8.66 points, to finish the session flat at 8,176.210.
Gains in healthcare and material stocks were offset by declines in the consumer staples and information technology sectors. The top losers on the index were Xero Ltd and a2 Milk Company Ltd, dropping 2.6 percent and 2.2 percent, respectively.
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