Australia shares trim losses after RBA stands pat; NZ down

[BENGALURU] Australian shares ended weaker on Tuesday, but trimmed earlier losses, after the country's central bank signalled a steady policy outlook and China said it would introduce further measures to shore up its cooling economy.

The S&P/ASX 200 index finished down 0.3 per cent, or 18.10 points, at 6,199.30. The benchmark rose 0.4 per cent on Monday.

The Reserve Bank of Australia (RBA) left its cash rate at 1.5 per cent on Tuesday as it remained optimistic about the economy's outlook, despite acknowledging a slowdown.

Economic growth is expected to have almost stalled in the last quarter of 2018 as trade shaved more from growth than expected. Figures on Australia's gross domestic product are due on Wednesday.

Mathan Somasundaram, Market Portfolio Strategist at Blue Ocean Equities, said the RBA's optimistic view about the economy and China's talk about stimulus have helped the markets recover.

Stocks had retreated in early trade after China set its 2019 economic growth target at 6.0 to 6.5 per cent, lower than last year's goal of 6.5 per cent.

Concerns of a slowdown in China, Australia's top raw material's importer, have weighed on mining stocks. Mining majors BHP Group Ltd and Rio Tinto Ltd both lost 0.9 per cent.

However, market sentiment slightly improved after China said it would cut billions of dollars in taxes and boost lending to small firms in a bid to shore up an economy that is growing at its slowest pace in almost 30 years.

The financial sub-index was down 0.3 per cent at the end of the session, with the country's No 3 lender Australia and New Zealand Banking Group Ltd retreating half a per cent.

Energy stocks reversed course to edge up as index heavyweight Woodside Petroleum advanced 0.3 per cent, while peer Santos Ltd added 1.6 per cent.

New Zealand's benchmark S&P/NZX 50 index retreated from its record high in the last session, falling 0.15 per cent or 13.80 points to finish the session at 9,399.69.

Electricity retailer Meridian Energy Ltd slipped 0.8 per cent while telecom firm Spark New Zealand Ltd declined 1.1 per cent.

On the other hand, milk producer Fonterra rose about 1.2 per cent after it appointed Miles Hurell as permanent chief executive of the co-operative.

REUTERS