Australia's S&P /ASX 200 is retreating from a 3-day high of 4273.4 as resources drop on position-squaring ahead of the Anzac day public holiday and as lingering European political and economic worries weigh on sentiment. BHP (BHP.AU), Rio Tinto (RIO.AU), Woodside (WPL.AU) and Fortescue ( FMG.AU) are down 0.9%-1.6%. Yield stocks remain firm, with the major banks up 0.4%-1.5% and Telstra (TLS.AU) 1.9% higher. But the momentum has slipped out of the market following the scramble to buy on the back of below-consensus CPI data that strengthened the case for RBA interest-rates cuts as early as next week. Macquarie (MQG.AU) is down 2% after falling steadily after U.S. peer weakness. Anyone who bought after the CPI data must be kicking themselves as the market looks like closing in the red. While it undershot expectations, the CPI data haven't changed expectations of 100 basis points of interest-rate cuts in the next 12 months. In reality, the impact on demand is due to be offset by severe fiscal tightening over the next 12 months, so the market needs the Australian dollar to fall for any interest-rate cuts to have much impact on stocks. The Index was last up 0.1% at 4357.8
