Australia shares fall as miners sag; NZ up
* Financials gain tracking Wall Street peers
* BHP cuts iron ore production guidance
* Metals & mining index falls most in nearly 4 months
By Aby Jose Koilparambil
April 17 (Reuters) - Australia shares struggled in early
trade on Wednesday, weighed down mainly by mining stocks,
although the losses were capped by gains in financials, which
tracked their Wall Street peers.
The S&P/ASX 200 index fell 0.2 percent, or 10
points, to 6,267.40 by 0052 GMT. The benchmark rose 0.4 percent
Miners came under pressure after the world's top iron ore
miner Vale SA said it expects to resume operations
within 72 hours at its Brucutu mine in Brazil.
Australia's big miners have gained over the past few months
on concerns over tight supply after production disruptions at
Vale following a dam mishap in January pushed up prices of iron
ore to multi-year highs.
Diversified miners BHP Group Ltd and Rio Tinto
fell 2.2 percent and 3.7 percent, respectively, while
iron ore-focused Fortescue Metals Group dropped 7.4
Analysts at Jefferies said in a note that Vale's Brucutu
restart was a "small net negative in the short term" for Rio
Tinto, BHP and Fortescue, and iron ore prices might pull back in
the very near term.
"Based on leading economic indicators, including the
re-acceleration of credit growth in China in the first quarter,
we expect iron ore demand to gradually improve," Jefferies said.
The metals and mining sub-index, the second largest
benchmark constituent, slid as much as 2.3 percent, its biggest
intraday percentage fall in nearly four months.
Separately, BHP on Wednesday followed its rival Rio Tinto by
cutting its annual iron ore production forecast due to
disruptions caused by a tropical cyclone that hit its quarterly
Gold firms also fell, with the sub-index dropping
more than 2 percent, after bullion slipped to its lowest level
Meanwhile, financials, the largest sector in the
benchmark, firmed 1 percent, with all 'Big Four' banks advancing
in the range between 0.7 percent and 1.1 percent.
Finance stocks were the biggest percentage winners on Wall
Street too, underpinned by positive earnings including those
from the world's largest asset manager BlackRock.
Meanwhile, investors await a raft of Chinese data due at
0200 GMT, notably first quarter GDP, looking for leads on the
health of Australia's biggest trade partner.
China's economic growth is expected to slow to a near
30-year low of 6.2 percent this year, a Reuters poll showed.
Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50
index advanced 0.4 percent to 9,943.80, with the
local-listed shares of lenders Westpac Banking Corp and
Australia and New Zealand Banking Group featuring among
top percentage gainers.
(Reporting by Aby Jose Koilparambil in Bengaluru
Editing by Jacqueline Wong)
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