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Australia: Shares extend falls; weak China data weighs on market

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[BENGALURU] Australian shares ended lower for the second straight session on Friday as investors took money off the table after a recent rally and weak economic growth data out of China took a toll on energy stocks.

The S&P/ASX 200 index closed 0.5 per cent lower at 6,649.70, but managed to tack on 0.6 per cent for the week. It gained in eight of the previous 10 sessions, with a five-day rally coming to a halt on Thursday.

Trading was thin as investors waited to see if the Brexit deal gets the UK parliament's approval and for further developments on the US-China trade talks.

Economic growth in China, Australia's top trade partner, slowed more than expected to its weakest pace in almost three decades in the third quarter, as the bruising trade war with the US hit factory production.

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However, industrial output grew a better-than-expected 5.8 per cent in September, faster than the 17-year-low posted in August.

The heavyweight financials index slipped 0.4 per cent, with all the "Big Four" lenders finishing in the red, losing between 0.3 per cent and 0.8 per cent.

The metals and mining index fared better than the broader market, dropping only 0.1 per cent. Diversified miner Rio Tinto closed up 0.8 per cent, mainly on higher copper prices, while BHP Group ended 0.2 per cent lower as iron ore prices continued to fall.

Gold miner St Barbara Ltd slid about 9 per cent and was the top percentage loser on the benchmark stock index after the company cut production guidance for its flagship Gwalia project.

Energy stocks dropped 0.8 per cent as weak growth data from China, the world's largest oil importer, hurt oil prices.

Origin Energy closed down about 2.5 per cent and was the top percentage loser among energy stocks.

All the major sector indexes finished lower, with consumer staples and property stocks shedding 1.7 per cent and 0.6 per cent, respectively.

"The pressure on industrial, consumer staples and property trusts stocks was due to domestic issues and that points to investors battening down the hatches ahead of event risks rather than concerns about growth in China," said Michael McCarthy, chief market strategist at CMC Markets.

"Given the strong start to the week, the reversal we saw yesterday in the region continued to today's trading."

Digital payments platform Afterpay Touch Group Ltd declined 7.3 per cent, extending its losses into a third session after brokerage UBS warned the regulatory risks facing the buy-now-pay-later (BNPL) sector.

On Friday, a report said the Reserve Bank of Australia would investigate whether "policy action" is required to target BNPL operators who prevent merchants from passing on the costs to customers.

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index closed down 0.7 per cent, with Meridian Energy Ltd and dairy firm a2Milk Co losing more than 2 per cent each.

REUTERS