THE stock market has finished 2010 on a disappointing note, dropping almost one per cent amid broad-based declines.
At 2.10pm (AEDT) close, the benchmark S&P/ASX200 index was down 45.2 points, or 0.94 per cent, at 4745.2 points, while the broader All Ordinaries index had fallen 39.8 points, or 0.81 per cent, to 4846.9 points.
On the ASX 24, the December share price index futures contract was 58 points weaker at 4738 points, with 9878 contracts traded.
The ASX200 finished 2010 about 2.5 per cent down on its 2009 closing level.
All the major components of the market finished lower - the materials sector slipped 1.06 per cent, financials backpedalled 1.16 per cent and energy stocks ended down 0.69 per cent, according to Iress data.
Just two companies on the S&P/ASX20 closed in positive territory - Telstra and Westfield Retail Trust finished up one cent at $2.79 and $2.57, respectively.
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Bell Potter senior adviser Stuart Smith said most fund managers did their end-of-year book squaring prior to Christmas and had spent the past week maintaining their positions as the year drew to a close.
"It has just been a matter of fine tuning on not much volume," Mr Smith said.
IG Markets research analyst Ben Potter said the local market followed the lead from Wall Street where US investors booked in some profits following solid gains in December.
"People have probably locked in a little bit of profit and called it quits for the year," Mr Potter said.
Offshore leads were mostly negative - Wall Street closed lower, while precious metals and crude oil prices finished weaker.
One bright spot during the overnight session was the performance of copper, which climbed about 1.2 per cent.
Among resources stocks BHP Billiton eased 60 cents to $45.25, while Rio Tinto slipped 23 cents to $85.47.
Local banking stocks finished weaker.
ANZ fell 33 cents to $23.35, Commonwealth Bank was down 50 cents to $50.77, National Australia Bank was 33 cents weaker at $23.70 and Westpac slipped 40 cents to $22.21.
Insurers were also in negative territory as devastating floods continued to cause chaos across large swathes of Queensland.
Suncorp declined nine cents to $8.61, Insurance Australia Group was down six cents at $3.88 and QBE was off 24 cents at $18.15.
Suncorp, which includes insurance brands AAMI, Apia, GIO and Vero, on Friday reassured investors it has a reinsurance program, adding that it had received 1,450 claims from across Queensland since Christmas Eve.
Bell Potter's Mr Smith said he expected the cost of the floods, estimated to be the worst in 50 years, to be substantial.
"It's a bottomless pit to try and find out what the damages claims will be on Suncorp's insurance side of things," Mr Smith said.
"we all know that they spread the risk around, but still this is going to be greater than 2008."
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