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Australia: Shares weighed by trade worries; focus on RBA decision
[BENGALURU] Australian shares weakened on Monday, tracking the broader selloff in global markets as worries about the US-Sino trade war shook investor confidence, weighing on commodities and financials stocks.
Australia's S&P/ASX 200 index was 0.7 per cent, or 45.6 points, lower at 6,351.3 by 0153 GMT. The benchmark lost nearly 1 per cent last week.
Defying the selloff, gold stocks rallied as their safe-haven appeal brightened against the gloomy global backdrop, sending the sub-index to its best level in over seven years.
"Trade wars and tariffs rattle markets as we await a big week of data," said Greg McKenna, founder of Sydney-based financial advisory firm McKenna Macro, in a note.
In a recent development, Chinese Vice-Commerce Minister Wang Shouwen, speaking at the unveiling of a new government policy paper on trade, said Beijing should not be blamed for a decline in US manufacturing jobs.
"The Chinese Trade White Paper... suggests that China is in no mood to back down in the face of attempts it sees as the US trying to bully it into changing its system of governance," McKenna added.
Investors will closely watch the Reserve Bank of Australia (RBA) decision on Tuesday, at which the central bank is expected to cut rates, and economic growth data later this week.
Prices of commodities such as iron ore and copper, among Australia's top exports, came under pressure as global growth concerns raised doubts about the demand for resources.
This weighed on local mining and energy markets. The latter lost as much as 2 per cent to touch its worst in over four months.
Oil and gas players Santos, Woodside Petroleum and Oil Search gave up between 2.4 per cent and 2.6 per cent, while global mining majors BHP Group and Rio Tinto were also 1.8 per cent lower, each.
Financial stocks, which boast the highest weightage on the main index, were set for their fourth straight session of declines and lost a much as 0.9 per cent.
The "Big Four" banks fell between 0.6 per cent and 1.3 per cent.
Gold miner Newcrest Mining notched up as much as 3.9 per cent to its highest since 2012, alongside peers such as Evolution Mining and St Barbara which also gained between 3.4 per cent and 5.5 per cent.
New Zealand's stock market was closed on Monday for a public holiday.