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Australia shares close lower as U.S. stimulus appears elusive

Published 22/10/2020, 05:02 pm
© Reuters.

* Energy stocks slip as oil prices fall further

* Gold stocks decline as bullion prices retreat

* Miners, healthcare stocks buck downtrend (Updates to close)

By Nikhil Subba

Oct 22 (Reuters) - Australian shares fell on Thursday, weighed down by energy and financials stocks, as talks on a new U.S. fiscal coronavirus aid package dragged on, raising fears of a delayed deal.

The S&P/ASX 200 index .AXJO fell 1.5% in intraday trade before miners helped it recoup some of the losses to settle 0.3% lower at 6,173.80, its lowest close since Oct. 12.

Overnight, Wall Street's three major averages closed lower, after U.S. President Donald Trump accused Democrats of being unwilling to craft an acceptable compromise on stimulus. Speaker Nancy Pelosi also expressed doubts over the passage of a deal before the presidential election.

"I'm very doubtful that we will get any stimulus agreement being this so close to the election... It has the potential to put either party at a disadvantage if they were to agree with something now," said Brad Smoling, managing director at Smoling Stockbroking.

Australian energy stocks .AXEJ closed 1.9% lower as oil prices extended losses after a build in U.S. inventories pointed to a deteriorating outlook for fuel demand. O/R

Oil Search OSH.AX closed 3.7% lower after hitting a two-week low earlier in the day, while Santos STO.AX slipped 1.9%.

Financials .AXFJ fell 0.5% after earlier touching their lowest level in more than a week. The "Big Four" banks - Australia and New Zealand Banking Group ANZ.AX , National Australia Bank NAB.AX Commonwealth Bank of Australia CBA.AX and Westpac Banking Corp WBC.AX - slipped between 0.5% and 0.8%.

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Gold stocks .AXGD declined 0.7% as bullion prices retreated. Resolute Mining RSG.AX fell 6.4% and Chalice Gold Mines CHN.AX lost 6.7%. GOL/

Miners .AXMM finished 0.2% higher, with both BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX adding about 1%.

In New Zealand, the benchmark S&P/NZX 50 index .NZ50 fell 0.2% to 12,407.3. Top losers were Chorus Ltd CNU.NZ , down 2.1%, and Fisher & Paykel Healthcare Corp FPH.NZ , losing 1.7%.

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