Australia: Shares edge down as oil slump hits energy stocks; New Zealand flat

[BENGALURU] Australian shares inched lower on Thursday as a slump in oil prices dented energy stocks, offsetting a rise in financials which had gained on heightened expectations of further interest rate cuts by the central bank after bleak employment data.

The S&P/ASX 200 index eased 0.1 points to 6,537.8 by 0241 GMT. The benchmark ended flat on Wednesday.

Energy stocks fell 2.4 per cent as oil prices tumbled 4 per cent overnight after crude inventories rose amid concerns of dimming outlook for global oil.

Oil & gas explorer Woodside Petroleum fell as much as 2.2 per cent, while Oil Search and Beach Energy lost 2.4 per cent and 5.2 per cent, respectively.

Data released earlier in the day showed Australia's unemployment rate at 5.2 per cent in May, higher than the 5.1 per cent forecast.

"Small positive for the financials," said Damian Rooney, director of equity sales at Argonaut, "Certainly the central bank will be watching very carefully and if we see rate cuts by the US Federal Reserve we may well see one more cut by the Reserve Bank of Australia (RBA)."

The RBA cut rates to a record low of 1.25 per cent last week, a much anticipated move given Australia's subdued inflation and weak economic growth.

Financial stocks gained 0.3 per cent, with top lenders Commonwealth Bank of Australia adding up to 0.7 per cent and Westpac Banking Corp advancing 0.8 per cent.

Export-driven healthcare stocks, which have large exposure to the US market, were supported by a firmer greenback.

Index heavyweight CSL rose 3.2 per cent to its highest level in over 9 months, while Cochlear added 3.1 per cent.

The metals & mining index pulled back from the previous session's gains, falling 0.7 per cent as disappointing data from China stemmed the rise in copper prices.

Copper slipped as China reported the worst-ever monthly sales drop in the world's largest vehicle market, while factory inflation slowed in May as faltering manufacturing hit demand.

Global miner BHP Group retreated as much as 1 per cent and Rio Tinto lost 0.8 per cent. Fortescue Metals Group fell up to 2.9 per cent.

Conglomerate Wesfarmers dropped up to 4.8 per cent, its worst intraday session in more than 3 months, after it said price war and subdued consumer sentiment will lead to a fall in full-year earnings at its Kmart discount retail chain.

New Zealand's benchmark S&P/NZX 50 index was flat at 10,204.65.

Dairy products maker a2 Milk Company lost as much as 1.3 per cent, while Auckland International Airport added 0.7 per cent.

REUTERS