The benchmark S&P/ASX 200 index declined 6.9 points, or 0.1 per cent, to 5713.60, with gains from telecoms and insurers helping to limit downside as Telstra climbed 1.1 per cent and AMP rose 1 per cent.

Dragging on the index were shopping mall owner Westfield Corp, down 2.1 per cent, and housebuilder Stockland, down 1.4 per cent, as well as Mirvac Group, down 1.7 per cent. Cochlear fell 1 per cent as it traded ex-dividend.

The Australian dollar was trading at US79.82??, after rising as high as US79.90?? immediately after the release of minutes from the latest meeting of the Reserve Bank of Australia.

Although markets may have simplistically concluded that the RBA is getting set to tighten policy in line with major central banks around the globe, the final sentence of the minutes repeated a note of caution on high household debt, RBC economist Su-Lin Ong said.

"It hints at a central bank that is likely to sit on its hands until it sees much stronger signs of higher wages and inflation while monitoring broad house price developments," Ms Ong said.

ABS housing data out on Tuesday showed Sydney housing prices grew 2.3 per cent in the second quarter, compared to 3 per cent in March, for the weakest growth in a year. Overall growth across all capital cities came in at 1.9 per cent in the quarter and 10.2 per cent over the year, unchanged from a year ago.

The US has its own policy concerns this week, with the US Federal Reserve set to hold its policy meeting.

The meeting is expected to yield details on how the central bank will unwind its $US4.2 trillion portfolio of Treasuries and mortgage-backed securities, nearly a decade after the global financial crisis.

Standouts on the individual stock level on the ASX included TPG Telecom, which climbed 5.1 per cent after capping a dramatic financial year by delivering a 16 per cent increase in cash net profit and a 4 per cent increase in revenue that met analyst expectations.

Galaxy Resources climbed 4.9 per cent, continuing a recent strong run for the lithium miner, while BT Investment Management climbed 3 per cent and CYBG rose 2.5 per cent as both UK-facing firms continue to get a lift from recent changes to UK interest rate expectations boosting the pound.

Stockwatch

New Hope Coal

New Hope received a nice post-earnings bump on Tuesday, with shares in the resources firm rising 3.9 per cent in midday trading.

The firm's full year net profit shot up to $140.9 million, from a loss of $53.7 million in the comparable period, while revenue jumped 59 per cent to $844.1 million.

New Hope said that increased production and sales due to the inclusion of its Bengalla coal mine stake in the results helped the result. Higher coal prices in US dollars and Australian dollars along with recovery of rail access charges also worked to lift earnings during the year, it said.

Production at Bengalla is expected to continue to improve in fiscal 2018, New Hope said. Newcastle benchmark spot thermal coal prices recently exceeded US$100 per tonne but New Hope believes this level of pricing is not likely to be sustained.

"Actions taken by the Chinese government in managing domestic coal supply is having a positive impact upon Chinese domestic thermal coal prices. These prices are influential throughout Asia. Demand for high quality Australian thermal coal into Asian markets continues to grow," New Hope said.

"As ownership of the thermal coal industry in Australia continues to be rationalised, end users are becoming concerned about concentration of supply. New Hope, as an independent Australian controlled coal producer, has a growth strategy aligned to service the growing needs of electricity producers in the growth markets of Asia," it added.

Movers

Fertile gains

Incitec Pivot shares climbed 1.1 per cent over the session, adding to a gain of 2.5 per cent made on Monday.

The fertiliser maker advanced along with its US peers, which climbed after a recovery in prices for some key crop nutrients.

Last Friday, spot prices for urea at the US Gulf rose to the highest in six months, according to data from Green Markets, while prices for diammonium phosphate climbed to the highest since March.

The gains mark a turnaround for the fertiliser market, which has been mired in a slump as production capacity rises across the industry.

Green Markets reported that Yara International has decided to stop taking orders for nitrogen-based products in Europe, and India issued a surprise tender to buy urea that will close on September 25.

Carsales.com

Carsales.com is racing ahead of earnings, Citi analysts said, after downgrading the stock to neutral from buy.

The firm is trading on a 2018 estimated price-to-earnings ratio of 25.6 times which Citi said is close to an all-time high."In our view the stock is now fully valued," the Citi analysts said.

They believe that, similar to REA Group and Seek, Carsales,com is now mostly reliant on yield growth and adjacencies to drive earnings growth from its core operations.

Unlike its peers, however, Carsales.com's yield growth to date has been minimal with a 4 per cent compound annual growth rate in Australian classifieds pricing over the past five years, compared to 8 per cent for Seek and 26 per cent for REA, the analysts noted.

Carsales.com shares fell 1.2 per cent.

Dividends

There will be $15.5 billion worth of dividend cheques in the mail this month from ASX 200 companies, Morgan Stanley analysts estimate, with a third of the bounty to be paid on a single day: September 29.

Adding in October payments, the total payout will be $21.7 billion, ahead of the $20.2 billion paid in March and April (following the half-year earnings results).

Income returns are especially important during periods of weak or negative price gains, and this year is no different. In 2017 dividends have "kept the market above the line," write the Morgan Stanley analysts.

So far this year, the ASX 200 total return is 6 per cent, against a capital gain of 1.2 per cent, on Bloomberg data. So income has accounted for 80 per cent of the returns.

Australian dollar

The dollar went on a bit of a rollercoaster ride on Tuesday, rising in the early part of the session before falling back sharply following the release of the minutes from the latest Reserve Bank of Australia interest rate meeting.

The Aussie traded at US79.82??, after reaching as high as US79.90?? immediately after the release of the minutes.

Economists noted the level of the currency, with Commonwealth Bank economist Gareth Aird saying "the Australian dollar looks stuck at around US80c."

He was commenting after the release of the RBA minutes and added that any further appreciation in the currency because of movements in interest rate differentials would likely be undesirable.