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Australian shares down on intensifying trade war tensions; NZ down

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[BENGALURU] Australian shares fell sharply on Monday as financial markets fretted over global trade war tensions after US President Donald Trump threatened more tariffs on Chinese imports.

Financials were the biggest drag on the S&P/ASX 200 index, which fell 0.9 per cent, or 55.9 points to 6,230.0 by 0200 GMT. The benchmark rose 0.4 per cent on Friday.

Mr Trump said on Friday he was ready to impose tariffs on all US$500 billion of imported goods from China, as a trade dispute between the world's two biggest economies intensified with no signs a resolution was near at hand.

Mr Trump's more aggressive protectionists policies have sparked retaliatory measures from countries around the world, rattling financial markets worried about the impact on global growth.

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Christopher Conway, head of research and trading at Australian Stock Report said: "It's a couple of factors coming together, but for the most part it is the trade war tensions that's driving our markets lower."

Financial stocks tugged on the benchmark, with the main financial index down one per cent.

Westpac Banking and Commonwealth Bank of Australia led the losses among the 'Big Four' banks, down 1.2 per cent and 1.1 per cent, respectively.

Westpac's wealth management unit, BT Financial Group, cut prices of its flagship platform at a time when its peers have retreated from their wealth businesses.

Shares of global miner BHP slipped 1.3 per cent after it confirmed that it had been served with a class action lawsuit regarding the 2015 Samarco dam failure in Brazil. Last week, BHP said it expected a US$650 million charge in its fiscal 2018 results on account of the failure.

The Aussie mining index was down 0.9 per cent, as commodity prices remained pressured by global trade tensions.

Mining-to-home improvement conglomerate Wesfarmers was among the top losers on the benchmark. The firm expects the demerger of its Coles supermarket chain to be completed by November and plans to retain 15 per cent of the spin-off.

Wesfarmers was down as much as 1.3 per cent.

Gold stocks looked set to snap a recent run of losses as the US dollar eased on Mr Trump's criticism of the Federal Reserve's interest rate hikes.

After losing nearly 6 per cent last week, the gold index was up 0.5 per cent, with Evolution Mining the biggest boost.

New Zealand's benchmark S&P/NZX 50 index slid 0.7 per cent or 66.54 points to 8,889.0.

After closing flat on Friday following four straight sessions of losses, a2 Milk Company slipped into the red again, down over 3 per cent at a near two-month low.

Fletcher Building and Spark New Zealand were the other big losers, down as much as 3.5 per cent and 2.3 per cent, respectively.

REUTERS