Australia: Shares slip on Wall Street weakness, growth woes

[BENGALURU] Australian shares declined on Wednesday as a brief two-day streak of gains gave away to renewed worries about the global economy, with miners and retailers dragging down the broader market.

The benchmark S&P/ASX 200 index fell 0.9 per cent to 6,103.70 by 0100 GMT after gaining about 2.2 per cent over the past two sessions.

Financial shares led US stocks lower overnight to end a three-day rally as investors awaited comments from Federal Reserve Chair Jerome Powell at the end of the week.

Last week's inversion of the US bond yield curve, which have presaged several past US recessions, triggered a shakeout in financial markets worried about a slowdown in global growth. While signs of more policy support from China and Germany helped soothe nerves this week, lingering recession anxiety have kept investors on edge.

The heavyweight mining stocks dented the Australian market, as Chinese iron ore futures fell for a fourth straight session on easing supply concerns, while stepped-up production curbs in top steelmaking city of Tangshan added more pressure.

Diversified mining behemoths BHP Group Ltd and Rio Tinto Ltd fell as much as 1.5 per cent and 1.2 per cent, respectively, while iron ore-focused player Fortescue Metals Group slipped 2.4 per cent.

Retail stocks were also among major decliners in morning trade with the Australia-listed shares of New Zealand dairy firm a2 Milk Co plummeting about 13 per cent.

The parent company of the dairy firm tumbled 15 per cent on the New Zealand bourse as it reported lower-than-expected annual profit on the back of higher marketing costs which ate into gains from robust Chinese sales.

Financials, a major constituent of the benchmark, lost about 0.7 per cent with all the 'Big Four' lenders trading lower between 0.5 per cent and 1.1 per cent.

Stockland Corp fell about 5 per cent after its annual net profit slumped nearly 70 per cent, and the residential developer warned on a softer performance for the 2020 fiscal year.

Shares of Australia's biggest casino operator Crown Resorts slipped 0.6 per cent after it posted a 4.7 per cent decline in annual profit, hurt by lower spending by wealthy Chinese gamblers.

Gold stocks, however, glittered as prices of the safe haven metal firmed above US$1,500 and the sector-specific index for the bullion climbed as much as 2.4 per cent.

Major gold miner Newcrest Mining Ltd tacked on about 2.5 per cent.

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index too snapped a two-day winning run to fall 1.6 per cent to 10,625.98.

However, home builder Fletcher Building outperformed the benchmark after it posted an annual net profit, compared with a year-earlier loss, boosted by increased sales and higher demand for its building products.

REUTERS