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Australian stocks ended lower on Monday owing to a softer Wall Street and a fire last week which weighed on oil producer Santos.

The benchmark S&P/ASX 200 index closed down 14.7 points, or 0.45 percent, at 3,286.0. The declines returned the key stocks gauge to technically neutral ground.

David Spry, head of research at Melbourne-based F.W. Holst & Co, said the day's trading was trend-less, typical of holiday-thinned trading. He said the impact of a softer Wall Street was mild, but negative, nonetheless.

"There's also some apprehension about the earnings outlook. The Australian dollar continuing to rise is probably being seen negatively at the moment for companies that get their earnings overseas," Spry said.

The Australian dollar was trading above 76 US cents, hitting fresh 6-1/2 year highs as investors gave the US dollar a wide berth.

The robust Aussie capped media giant News Corp, which earns most of its revenues in the United States, paring the stock four cents to A$12.19 despite gains of nearly two percent in New York by its US-listed ADRs. Santos was the market's focal point, falling as much as five percent to a three-week low of A$6.35. However, it recovered somewhat to stand 3.9 percent down at A$6.43.

The declines were sparked by its estimate that a fire at its Moomba Gas Plant in South Australia will cut net profit after tax by up to A$30 million ($23 million), slicing up to nine percent from the 2004 consensus profit forecast of A$330 million.

Santos has shed seven percent since the New Year's Day fire.

Australia's biggest power retailer AGL slid 1.2 percent to A$11.06 after it declared force majeure on gas supplies to its major customers after the Moomba shutdown.

Energy retailer and Moomba stakeholder, Origin, estimates the fire will cut its net profit by up to A$6 million.

However, Origin was 1.9 percent up to A$4.75 after it said robust performance so far in fiscal 2004 would more than offset the Moomba impact. A shift away from safe-haven stocks trimmed National Australia Bank 1.7 percent to A$29.42.

Gold producer Lihir added 2.0 percent to A$1.50 after spot gold hit a 14-year high of $418 an ounce in Asia.

Copyright Reuters, 2004


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