The S&P/ASX 200 index ended 0.8 per cent lower at 5433.0, posting its fourth loss over five sessions, with miners and energy stocks facing the brunt of the selling in that period. For the month, the benchmark index slipped 2.3 per cent, after its blockbuster 6.3 per cent rally in July.

One of the standout features of the local market, as well as global markets, over the month was the lack of volatility. The benchmark index posted just one move of more than 1 per cent in August. But over the past week, a slew of comments from US Federal Reserve officials hinted at rate rises as early as next month, which ruffled investors' feathers.

Meanwhile, earnings season ended on Wednesday, with Harvey Norman's bumper result one of the highlights of the day. The stock rose 2.7 per cent to its highest in more than eight years after net profit jumped 30 per cent, buoyed by strong sales of furniture, homewares, appliances and electronics after an unprecedented surge in new homes in Australia.

But overall, analysts agreed that it was a relatively uninspiring earnings season. "It's hard to get excited," Goldman Sachs said in a note to clients, pointing out that while there weren't more disappointments than in past years, there were fewer positive surprises.

"Highlighting just how difficult it was to find good news stories, only five stocks delivered on all fronts (beat on sales and earnings and saw upgrades): Fortescue, Seven Group Holding, GWA Group, JB Hi-Fi and Mayne Pharma."

Deutsche equity strategist Tim Baker said that despite "fairly good earnings" the local market had underperformed global peers in August.

"This may reflect a realisation that expectations were a little too high going into earnings season, but also that Australia's price-earnings ratio was relatively high after the outperformance of the past nine months," he said.

Mr Baker said he expected the market to correct a bit more after July's strong rally, forecasting the ASX 200 to end the year around 5350 points.

MARKET MOVERS

The month that was

The worst performing sector over the month were telecoms, which dropped 8.9 per cent, pacing falls in giant Telstra, followed by a 5.8 per cent retreat for utilities. August's best was the relatively small IT sector, which climbed 4.6 per cent after Computershare climbed 11 per cent and up-and-comer Altium 26 per cent. Financials fell 2.6 per cent, while materials inched up 0.1 per cent despite heavy losses in recent sessions.

Gold equities

Gold miners continue to do it tough amid a declining gold price, with the sector far and away the worst performer on Wednesday as it plunged 3.7 per cent. The precious metal's price has come under pressure in recent weeks amid talk of higher US rates, which has taken the shine off the non-yielding asset. The All Ords gold miners index is off 19 per cent since July 11, but is still up 75 per cent this year.

Aussie dollar

Climbing bets of an imminent US rate rise have bolstered the greenback, at the expense of the local currency, as well as assets which are priced in US dollars, including commodities. Three weeks ago, the Aussie was pushing boldly towards 78 US cents, but overnight Tuesday, it almost dropped below 75 US cents. "The Fed's more upbeat mood and a summer of record highs on Wall Street have boosted the US dollar's yield appeal," Westpac currency strategist Sean Callow said.

Lending

Total private credit returned to moderate growth in July, driven by a weak rebound in the business sector, which had slowed over recent months. According to the RBA's private sector credit data, housing lending expanded by 0.5 per cent in July, to be up 6.6 per cent from a year ago. Lending to owner occupiers grew at an annual rate of 7.6%, just near multi-year highs. But at 4.8 per cent, annual growth in investor lending is the slowest since 2009.

STOCK OF THE DAY

Macquarie Atlas Roads reported a solid earnings result on Tuesday, but after enjoying a 45 per cent surge in its share price leading into the report, "solid" was not good enough, and the shares dropped 5 per cent to $5.54 on Wednesday after two brokers reduced their recommendations on the stock.

Macquarie analysts downgraded their recommendation to "neutral" saying the recent share price rally captures the company's core earnings growth potential, although they noted that their could be more upside from a buyout of the remaining 50 per cent stake in the Dulles Greenway tollroad in the US. Credit Suisse also downgraded their rating to "neutral", despite a price target of $5.90.

Patersons analysts upped their fair value estimate for the stock to $5.20 from $4.20, but that still leaves the stock overvalued they say, retaining their "reduce rating".