Australian and New Zealand shares were held back on Monday, with gains in natural resources undermined by financial stocks, dogged by an increase in poorly performing loans and a scandal over interest rate fixing.
The S&P/ASX 200 index (xjo) eased 0.4 percent or 19.70 points to 4,917.900 by 02:10 GMT. The benchmark lost 1.2 percent last week and hit a one-month low in the last session.
Banking stocks were again a drag on the index, led by a 1.2 percent drop in Westpac Banking Corp (WBC) over suspected rigging of benchmark interest rates.
Macquarie Group (MQG) dropped 1.3 percent, while Australia and New Zealand Banking Group (ANZ) shares (ANZ) fell 0.8 percent.
Chris Conway, head of research and trading at Australian Stock Report, said the sector's share price outlook will be dictated by the outcome of the banks' earnings due out next month.
"It will depend on whether there is any deterioration in bad debt and on their liabilities to the mining sector," he said.
Investors could not find a good reason to buy shares in the leisure sector with Nine Entertainment (NEC) down 2.8 percent, while gambling companies Crown (CWN) and Tabcorp (TAH) were both off 3 percent and 2.7 percent.
But the energy sector outperformed in the wake of a rally in oil prices. WorleyParsons (WOR) jumped 3.7 percent, Origin Energy (ORG) climbed 3.4 percent and Santos (STO) rose 2.35 percent.
Miners also received a boost with BHP Billiton (BHP) up 0.5 percent, while Rio Tinto (RIO) gained 0.8 percent. Fortescue Metals(FMG) jumped nearly 4 percent.
New Zealand's benchmark S&P/NZX 50 index (nz50) eased slightly in early trading Monday, down 0.3 percent or 2 points at 6,728.18.
Yet, it remained within reach of a record peak touched earlier in the month. The index rose 0.3 percent last week, the eighth consecutive week of gains.
Brad Gordon, investment advisor for Macquarie Equities said a dearth of local data meant the New Zealand market is largely tracking Australia's market.
Looking ahead, he said investors may take some direction from the U.S. earnings season as it kicks off.
The biggest gainers were Sky City (SKC), up 3.5 percent and Nuplex (NPX), up 3.4 percent. Nuplex is benefiting after its independent directors unanimously recommended Allnex Belgium SA/NV's NZ$1.05 billion ($715.68 million) takeover bid.
In the other direction, Air New Zealand (AIR) shed 1.6 percent. Gordon said it was probably due to some profit taking after its recent strong run.
