Aussie shares fall as trade war fears resurface, NZ down too

[BENGALURU] Australian shares fell on Wednesday as fears of a global trade war resurfaced after free-trade advocate Gary Cohn resigned as US President Donald Trump's top economic adviser.

Sentiment was further soured after data revealed that Australia's economy grew more slower than expected during last quarter.

The S&P/ASX 200 index dropped 1.01 pct, or 60.4 points, to 5,902.0 at the close of trade. On Tuesday, the benchmark rose more than 1 per cent.

Markets were rattled by growing fears of a global trade war following Mr Cohn's resignation. He chose to resign after he lost a fight over Mr Trump's plans for hefty steel and aluminium import tariffs.

Australia's gross domestic product rose 0.4 per cent in the December quarter, while analysts had looked for an advance of around 0.5 per cent despite trimming expectations following soft indicators such as low wage growth and consumption.

Reserve Bank of Australia (RBA) Governor Philip Lowe expressed concern over the US tariff proposal. Australia depends largely on the export of raw materials, and heftier tariffs on such could damage the economy.

Financial stocks were the biggest drag on the benchmark, ending 0.4 per cent lower with the 'Big Four' banks losing between 0.7 per cent to 1.6 per cent.

Westpac Banking Corp was the biggest drag on the ASX 200, pulling it back about 6 points.

Commonwealth Bank of Australia on Wednesday announced it expects to raise US$586.7 million through an issue of hybrid capital notes called 'PERLS X'. Its share-price declined about 0.7 per cent for the day.

Material stocks also fell, with the sector index down 0.8 per cent as commodity prices lost ground.

Price of most metals slipped on Wednesday on heightened fears of a trade war that could derail global growth.

The New Zealand benchmark index also fell 0.52 per cent, or 43.32 points, to 8,284.340 as healthcare and consumer staples stocks weighed down the market.

Fisher & Paykel Healthcare Corporation Ltd ended 3.28 per cent lower, while A2 Milk Company Ltd shed 1.5 per cent, declining for a fifth straight session.

REUTERS