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Australia: Shares struggle as copper dives

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Australian shares struggled on Wednesday as commodity prices continued to skid on renewed concerns about the global economy.

[SYDNEY] Australian shares struggled on Wednesday as commodity prices continued to skid on renewed concerns about the global economy.

Copper futures plunged 6.3 per cent to the lowest since 2009 as major chart support cracked.

Not helping the mood was news the World Bank had cut its global growth forecasts because of sluggishness in the euro zone, Japan and some major emerging economies.

As a result, the S&P/ASX 200 index eased 0.2 per cent or 8 points to 5,391.8 points by 0214 GMT. If sustained, it would be the third day of declines, taking this week's losses to 1.3 per cent.

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Iron ore miners suffered the most following a slide in the ore's spot price, with Fortescue Metals Group down 6.2 per cent, while BHP Billiton and Rio Tinto dropped around 1.5 per cent.

Banks also came under pressure, with Commonwealth Bank of Australia and Macquarie Group down 0.7 per cent, while Australia and New Zealand Banking Group eased 0.4 per cent.

Yet, the energy sector proved resilient following a 5 per cent tumble in oil prices overnight. Santos rose 2.2 per cent, while Woodside Petroleum gained 0.5 percent with the sector up around percent.

Stan Shamu, a market strategist at IG Markets, said the rise followed a small bounce in oil prices in the Asian session. "The medium-term view is still for lower oil prices," he said.

REUTERS

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