* Gains in financials offset by lagging materials
* Tabcorp among biggest losers after interim profit miss
* Financials underpinned by positive results
By Ambar Warrick
Feb 8 (Reuters) - Australian shares edged lower on Thursday following a soft lead from Wall Street as rising U.S. Treasury yields and the prospects of higher global interest rates kept investors on edge.
Material stocks dented the benchmark , tracking a downturn in global commodity prices, while financials rose on strong earnings and helped contain the broad market losses.
The S&P/ASX 200 index .AXJO fell 0.2 percent or 10.2 points to 5,866.70 by 0046 GMT. The benchmark rose 0.8 percent on Wednesday.
Overnight on Wall Street, the market ended a volatile lower as investors remained nervous after the rout of the past few days. .N
"The lead is clearly still volatility on the U.S. market, but what's impacted our markets more this morning are commodity prices and most of the losses today can be attributed to the major resource stocks," said James McGlew, executive director of corporate stockbroking at Argonaut.
Commodity linked stocks were the biggest drags on the index, with the Australian metals and mining index .AXMM shedding about 2 percent, led by mining stalwarts BHP Billiton (LON:BLT) BHP.AX and Rio Tinto (LON:RIO) RIO.AX .
Copper prices slid nearly three percent amid market volatility, while gold prices lost out to a stronger dollar. Oil prices were at a one-month low as U.S. crude inventories rose, fuelling worries of a price drop from extended supply. GOL/ MET/L O/R
Rio Tinto slid nearly 3 percent despite a record dividend payout for 2017. gloom also hurt gambling operator Tabcorp TAH.AX , which ranked among the worst performers on the benchmark after its interim profit came in below expectations. the other side of the ledger, financial stocks benefitted from strong results, with wealth manager AMP AMP.AX and National Australia Bank NAB.AX rising after both reported solid earnings.
The two stocks were among the biggest boosts to the benchmark, along with telecommunications provider Telstra TLS.AX .
"What investors look for in times of volatility is that they go to utilities, which Telstra's in, where you've got a predictable recurring income stream," McGlew said.
In New Zealand, gains in the healthcare sector were offset by falling telecommunication and consumer staples.
The benchmark S&P/NZX 50 index .NZ50 was largely flat at 8,194.72 points.
Ryman Healthcare RYM.NZ rose more than 2 percent, while teleco Spark New Zealand SPK.NZ and milk supplier a2 Milk ATM.NZ fell about 1 percent each.