The Australian sharemarket began the week under water as investors took a breather following last week's Donald Trump-inspired rally, dragged by mining stocks and two banks trading ex-dividend.
In a reversal of last week's buying thematic, shares in the big miners suffered, while defensive stocks were snapped up.
At close of trade the S&P;/ASX 200 Index was 0.5 per cent, or 25 points, lower at 5345.7, while the All Ordinaries finished 0.5 per cent, or 26 points, lower at 5420.3.
Gold miners were the hardest hit, with the gold sub-index posting its worst day since May as a stronger US dollar and higher bond yields took the shine off the precious metal. The gold spot price fell to its lowest point in five months. Newcrest Mining fell 7.1 per cent, Evolution Mining fell 9.7 per cent and Northern Star Resources lost 9.2 per cent.
VanEck Global portfolio manager Joe Foster said the election of Mr Trump may not be the end for the precious metal's strength, because the question over which of his policies will eventuate remains unclear.
"We see the recent weakness as a consolidation phase within what we believe is the early stages of the next bull market for gold," he said.
"We believe that investors will continue to be driven to gold as a safe haven given the further loss of confidence in central banks on a global scale and perhaps domestically, and the uncertainty following Trump's presidential victory."
The big mining stocks ignored a 7.5 per cent surge in spot iron ore prices at the weekend, with BHP Billiton closing 0.4 per cent lower and South32 dropping 1.8 per cent.
Bank stocks were mixed, with both Westpac and ANZ trading ex-dividend, losing 3.2 per cent and 1.5 per cent respectively, which together accounted for roughly two-thirds of the losses on the benchmark index. But National Australia Bank rose 1.1 per cent and Commonwealth Bank lifted 0.5 per cent.
Of the stocks that traded higher, Telstra bounced 1.3 per cent, off its two-year low last week, to close at $4.78. Fellow bond proxy Transurban also rebounded, rising 2.8 per cent. The telco and industrials sectors were the only two to finish with gains, up 1 per cent and 0.7 per cent respectively.
Market movers
Australian dollar
The local currency fell to a near one month low, its fourth straight session of losses on Monday after the US dollar continued to rise in the wake of the US election result. The currency is now 1.5 per cent lower since Mr Trump's shock election win, which sent US bond yields soaring on expectations his big spending plans will lift inflation. The Bloomberg Dollar Spot Index, a gauge of the US dollar against a basket of major peers, hit a nine-month high on Monday to 99.68 points. In late Asian trade the Aussie was buying US75.43¢.
China data
Mixed economic data from China briefly added to pressure on the local sharemarket. According to official data, industrial production rose 6.1 per cent in October year-on-year, below the expected 6.2 per cent. Retail sales rose 10 per cent, in line with expectations but softer than September's 10.7 per cent jump, but fixed asset investment rose 8.3 per cent, higher than the expected 8.2 per cent. "Growth momentum is stabilising," said Zhao Yang, Nomura's chief China economist. "But looking ahead, headwinds remain in the economy, as property markets in tier-1 cities have started to cool down
Iron ore
Iron ore futures traded on the Dalian Commodity Exchange in China surged again on Monday, continuing a mini-boom in the bulk commodity on the back of stronger steel and coking coal prices. Iron ore futures hit the 9 per cent limit on Monday before falling back to a 6.6 per cent rise, looking set to push spot iron ore prices above $US80 a tonne for the first time since October 2014. It follows a 23 per cent rally last week, the biggest gain since October 2008.
Gold
Australian listed gold miners continued their post-Trump slump on Monday, after the spot price of the precious metal fell to $US1211.25 an ounce, its lowest price in five months. Behind the sell off is a stronger US dollar and rising bond yields, which have surged on bets of President-elect Trump's fiscal stimulus policies would spark inflation. The All Ordinaries gold sub-index fell 7.9 per cent, adding to last week's 6.2 per cent tumble.
Stock watch: Central Petroleum
Shares in the junior oil and gas company surged 37 per cent to 18.5¢ on Monday, after the company rejected a takeover bid by Macquarie Group. The share price surge eclipsed the initial offer from Macquarie's commodities unit at 17.5¢ a share, which valued the company at $76 million as investors await a higher offer.
In a statement Central Petroleum said it would give Macquarie full access to its books, to "provide Macquarie every opportunity to reconsider its proposal." Macquarie is well versed with the Central; it has a $90 millon loan to the company and a 2.31 per cent equity stake.