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Australia: Shares at 1-month low on US rate rise concerns

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[BENGALURU] Australian stocks fell for a third straight session on Monday to their lowest in over a month as sentiment was dampened by comments from top US Fed officials raising the possibility of an interest rate hike this year.

The S&P/ASX 200 index fell 0.4 per cent as of 0232 GMT. The benchmark lost 0.5 per cent last Friday.

Fed chair Janet Yellen told a global monetary policy conference last Friday that the case for a rate increase had grown stronger, but she did not indicate when the Fed might hike rates.

However, Fed vice chair Stanley Fischer suggested a move could come at the central bank's September policy meeting if the economy was doing well.

Following Ms Yellen's speech, prices for fed funds futures implied investors see roughly a 60 per cent chance of a December hike, up from just above 50 per cent on Thursday, while chances of a September hike stood at 36 per cent, up from 21 per cent.

Investors will also look out for US payroll data due later this week that could determine the course of future interest rate hikes. "What we're seeing at the moment is a little bit of caution that the Reserve Bank of Australia's rate cutting on table might be deferred if the US raises rates," said Michael McCarthy, chief market strategist with Sydney-based CMC Markets.

"That's leading to some pressure on some previously well- favoured areas like consumer staples, utilities and industrials stocks."

Energy and consumer cyclical stocks were the biggest losers on the main index. Energy stocks took a beating on weakened oil prices as output from Iraq rose.

Oil and gas explorer Woodside Petroleum lost 3 per cent, while its peer Oil Search Ltd lost 2.1 per cent.

The gold index shed 3.8 per cent as the yellow metal edged lower on a steady US dollar.

Gold miners Newcrest and Northern Star Resources lost 2.9 per cent and 3.15 per cent respectively.

Mining giants BHP Billiton and Rio Tinto Ltd lost 0.4 per cent and 1.3 per cent respectively.

New Zealand's benchmark S&P/NZX 50 index was marginally lower as gains in industrial stocks were offset by losses in financials, with banks Australia and New Zealand Banking Group and Westpac Banking Corp among the worst performers.

Shares of Auckland International Airport rose 0.28 per cent, after it reported a jump in full-year profit and issued upbeat guidance.