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Australia: Shares drop on US-China trade talk uncertainty; NZ down

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[BENGALURU] Australian shares fell on Wednesday after US President Donald Trump offered no new details on trade talks with China, leaving investors on edge over whether the two sides will be able to reach a partial agreement that could defuse a major risk to global growth.

The S&P/ASX 200 index fell about 0.8 per cent, or 54.7 points, to 6,698.30 at the close of trade. The benchmark fell 0.3 per cent on Tuesday.

In a highly anticipated speech at the Economic Club of New York on Tuesday, Mr Trump offered little detail on the progress of a phase one trade deal. Rumours early on Tuesday that Mr Trump might announce a venue and date for signing a trade deal with Chinese President Xi Jinping proved unfounded.

However, Mr Trump emphasised that he would raise tariffs on Chinese goods "very substantially" if China does not make a deal with the United States.

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Market voices on:

"The market response seems to be a fair summary of the content of the speech," Robert Carnell, head of research at ING Asia-Pacific, said in a note to clients.

Australia's financial sub-index fell 1.2 per cent and led losses on the benchmark, with all of the "big four" lenders closing the session in negative territory.

Fund manager Netwealth Group fell 5.6 per cent after it said it expects its fiscal year 2020 core earnings margin to be lower than last year's level.

The metals and mining sub-index shed about 1 per cent to its lowest in over a week.

The world's two largest miners BHP Group and Rio Tinto fell 0.8 per cent and 1.7 per cent, respectively.

Data showed iron ore shipments to China from Australia's Port Hedland terminal, the world's biggest iron ore port, slipped 0.7 per cent in October from a month earlier.

Energy stocks shed 1 per cent on lower global oil prices. Top oil and gas producers Santos and Woodside Petroleum Ltd slipped 0.6 per cent and 1 per cent, respectively.

New Zealand's benchmark S&P/NZX 50 index fell 0.8 per cent, or 90.88 points, to 10,835.43, after the central bank unexpectedly left interest rates unchanged at 1 per cent.

A rate cut to 0.75 per cent was widely expected.

REUTERS