News: Australia shares weighed by oil, iron ore, NZ stocks shine again

Australian shares dropped 1.3 percent on Tuesday, as recent weakness in oil and iron ore prices took a heavy toll on the resources sector, in contrast to New Zealand where stocks scaled a record peak.

The S&P/ASX 200 index (xjo) slid 68.458 points to 5,117.600 by 02:32 GMT, away from a 10-week peak touched on Monday.

The energy and material indices were the hardest hit each with a loss of 1.7 percent. Among the worst performers, oil and gas companies Oil Search (OSH), Santos (STO) and Woodside (WPL) fell between 1.8 and 2 percent, followed closely by engineering firm WorleyParsons (WOR).

Miners were also sharply lower with BHP Billiton (BHP) off 2.2 percent, while fellow global miner Rio Tinto (RIO) slid 1.8 percent. Fortescue Metals (FMG) shed 0.4 percent after Moody's downgraded its ratings.

Oil prices bounced from lows on Tuesday, but investors were concerned that a recent rally may have run out of steam.

The major banks were not spared either, with all big four lenders down between 1 percent and 2 percent.

Ports and rail freight company Asciano Ltd (AIO), however, leapt 1.3 percent after it received a A$9.1 billion ($6.8 billion) takeover offer by Qube Holdings (QUB), Canada's Brookfield Asset Management Inc and international partners.

New Zealand's benchmark S&P/NZX 50 index (nz50) rose 0.3 percent or 19.1 points to 6,585.43. It touched, yet again, a new record of 6,607.86 with the index up 4 percent so far this year.

The biggest gainers were SkyCity (SKC), which added 4.9 percent and Spark (SPK), which added 1.7 percent. Investors are turning to high yielding stock in a bid to offset the low interest rate environment after the central bank cut interest rates to a record low 2.25 percent last week.

In the other direction, Fletcher Building (FBU) shed 0.4 percent and Auckland Airport (AIA) was trading down 0.2 percent.