New concerns about a Greek debt default are prompting the share market to start the week sharply lower.
US President Barack Obama has called on Greece to stabilise its finances while European Central Bank chief Mario Draghi says the Mediterranean nation needs to act with urgency if it wants EU financing.
The Australian market had followed Europe and the US’ weak leads from Friday night, Phillip Capital senior client adviser Michael Heffernan said.
“Greece is the word again – that’s what’s transfixed the markets,” he said.
“We’re not going to get intestinal cancer from what’s going on with Greece but just a bit of indigestion.”
Wall Street slumped on Friday, with the Dow Jones Industrial Average down 1.54 per cent and the broad-based S&P 500 falling 1.13 per cent.
Locally, the major banks were all weaker on Monday morning, with financial stocks posting heavy declines.
Commonwealth Bank dropped 80 cents to $91.28, National Australia Bank lost 41 cents to $38.31, ANZ fell 41 cents to $35.19 and Westpac was 44 cents lower at $38.46.
The mining giants failed to get a boost from the Chinese central bank’s decision to cut the level of funds that commercial banks must hold in reserve.
BHP Billiton fell 20 cents to $29.77 and Rio Tinto dropped six cents to $55.03.
But iron ore miner Fortescue Metals was one cent firmer at $1.88.
Energy stocks dropped after crude oil prices fell, following six days of gains.
Woodside Petroleum slipped 23 cents to $35.19 and Santos dropped three cents to $7.93.
Meanwhile, Telstra dropped one cent to $6.13.
And mining and metals group Arrium lost one cent, or 5.9 per cent, to 16 cents after reporting a sharp drop in its average price per dry metric tonne during the three months to March 31.
