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Australian shares recover as Clinton seen winning debate; NZ slumps

Tuesday, September 27, 2016 - 11:57
39913266 - 19_09_2016 - AUSTRALIA ASX.jpg

[SYDNEY] Australian shares recouped early losses on Tuesday, tracking wider Asian shares, as markets favoured Democrat Hillary Clinton's performance against Republican Donald Trump in the first of three US presidential debates.

The S&P/ASX 200 index was 41.02 points or 0.8 per cent lower at 5,390.4 by 0300 GMT, after sliding as much as 1.1 per cent in early trade.

In a heated debate held at Hofstra University in suburban New York, Democrat Hillary Clinton and Republican Donald Trump sparred over racism, sexism, taxes and foreign policy.

Markets have tended to see Mrs Clinton as the candidate of the status quo, while few are sure what a Trump presidency might mean for US foreign policy, trade and the domestic economy.

"The paring of losses I think is largely attributable to two factors: first of all we did not get any lunatic new policies and secondly it appeared that Clinton beat him on both the policy and the emotional component and that is seen as a positive or a less negative for the (Australian) markets," said Michael McCarthy, chief market strategist with CMC Markets.

Opinion polls have shown the two candidates in a very tight race, with the latest Reuters/Ipsos polling showing Mrs Clinton ahead by 4 percentage points, with 41 per cent of likely voters.

Financials accounted for more than half of Tuesday's losses, with Australia's "Big Four" banks down between 0.7 per cent to 1.6 per cent.

Mining giants BHP Billiton, Rio Tinto eased as much as 1.8 per cent and 1.9 per cent respectively, with BHP Billiton poised to snap eight straight sessions of gains.

Oil stocks were also among the worst losers, after crude futures slipped on Tuesday as investors booked profits on the 3 per cent gain in the previous session.

Oil and gas explorer Woodside Petroleum fell as much as 2.3 per cent, recording its worst intraday per centage performance in about two weeks. The S&P/ASX 200 Energy (GIC) Index shedded 0.9 per cent.

The ASX All Ordinaries Gold Index gained 1.2 per cent on the back of a 0.1 per cent increase in spot gold prices as uncertain equity markets at the start of the U.S. presidential debate shored up metal's safe-haven appeal.

Gold miners Newcrest Mining Ltd and St Barbara Ltd were among the top percentage gainers on the benchmark index.

New Zealand's benchmark S&P/NZX 50 index extended losses for a third session and fell 0.5 per cent or 39.8 points to 7,225.07, dragged by financials and consumer discretionaries.

Orion Health Group led the losses on the index, falling 4.4 per cent to its lowest in nearly six months.

Air New Zealand, on the other hand, gained 2.8 per cent after oil futures slumped on Tuesday.

REUTERS