Australian shares pared early losses to end down 0.4 percent on Monday, overcoming some weakness on political unrest in Egypt as a benign inflation gauge revived bank stocks and Wesfarmers outperformed after healthy second-quarter supermarket sales. The top four banks all gained, led by National Australia Bank with a 0.9 percent rise to A$24.66.
The Reserve Bank is expected to leave rates on hold when it meets tomorrow and investors have priced out almost any chance of a hike until the second half of the year after severe flooding is expected to lower economic growth. A private gauge of consumer prices showed underlying inflation slowed in January, adding to the case against a rise in interest rates anytime soon.
The benchmark S&P/ASX 200 index fell 21 points to 4,753.9, according to the latest available data. New Zealand's benchmark NZX 50 index also fell 0.4 percent, ending at 3,338.7. The Australian index fell as low as 4,717.6 in early trade, its weakest since January 12, as the Egyptian unrest hit global markets.
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