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Australian stocks

close lower on

Dow, resources

SYDNEY: The Australian share market closed lower for the second day running after a fall on Wall Street and continuing weakness in major resource stock.

At 0605 GMT, the All Ordinaries Index was 11.2 points lower at 2127.6. The September share price index futures contract was 18 points down at 2155, a premium of 27.4 points to the physical market.

The fall in the All Ordinaries was generally seen as expected after Wall Street's fall. Flat metals prices offshore and no fresh local news also contributed to the lacklustre performance of the local market, brokers said.

"Friday's performance was fairly ordinary, basically a knee jerk reaction to the drop in the Dow but the continuing resources sell off exacerbated the situation," said a Sydney trader.

Brokers said that despite the weaker performance over the last couple of days, the short term outlook was still positive.

Friday's reaction was the result of the fall on Wall Street but we see the general market outlook as positive," said Stuart Smith of Lance Jones.

"We see it as fairly quiet early next week but strengthening towards the end of week," he said.

Other brokers highlighted the continuing tendency of the local market to play 'follow the leader' to Wall Street.

"The majority of today was certainly Wall Street but if Wall Street rebounds tonight then so will our market on Monday," said Peter Struck, of Reynolds and Co.-Reuter