* Commodity prices weighing on resources stocks
* China factory data weakest in over 6 years
* Sentiment gloomy across the board (Adds quotes and stocks on the move)
SYDNEY/WELLINGTON, Sept 23 (Reuters) - Australian shares fell to a two-week low on Wednesday as concerns about the economic outlook for top trading partner China sent commodity prices lower, hitting sentiment towards stocks across the board.
Activity in China's factory sector fell to its weakest level in 6-1/2 years as domestic and export demand continued to slump, a private survey showed. ID:nS7N0XJ02A
Overnight, copper prices CMCU3 slid 3.6 percent, while oil was off 2 percent and iron ore dipped 1.8 percent as the Chinese government's efforts to stimulate growth failed to calm nerves in global markets.
By 0243 GMT, the S&P/ASX 200 index .AXJO was down 2.0 percent or 103.6 points at 5,000.0 points. The benchmark is down 4 percent from its September peak and down 7 percent for the year so far.
"The conviction to buy the market is falling through the floor," said IG Markets strategist Evan Lucas.
"It's at a point where the U.S. is going to stop giving you money (via quantitative easing), maybe in Europe the whole stimulus may not be working, and from an Australian-centric point of view, what is going on with China?"
Mining heavyweight BHP Billiton (LONDON:BLT) BHP.AX was down nearly 4 percent, near a seven-year low hit in August, as plans to raise money with hybrid securities added to unease over its exposure to faltering commodities demand. ID:nWNBS01DM2
Rival Rio Tinto (LONDON:RIO) RIO.AX dropped 2.6 percent while BHP spin-off South32 S32.AX tumbled 5.3 percent.
Energy stocks also fell in step with the oil price, with Woodside Petroleum WPL.AX off 2.5 percent while its takeover target Oil Search OSH.AX lost 0.9 percent, propped up by the prospect of a buyout.
Among banks, Commonwealth Bank of Australia CBA.AX and Westpac Banking Corp WBC.AX both shed 2.7 percent while Australia and New Zealand Banking Group ANZ.AX and National Australia Bank NAB.AX declined 2 percent each.
Retailers fared no better, with supermarket firm Woolworths WOW.AX sliding 2 percent and Wesfarmers WES.AX , which owns rival Coles, falling 1.8 percent.
New Zealand's benchmark NZX 50 index .NZ50 edged 0.1 percent, or 6.53 points, lower to 5,690.26. It has proved resilient to further signs of a weakness in China, New Zealand's top export market.
Shares in petrol retailer Z Energy Ltd ZEL.NZ was the top performer, up 3.2 percent after it said its acquisition of Chevron (NYSE:CVX) New Zealand was on track. ID:nL4N11T01O
Infrastructure investor Infratil rose 2 percent while telecoms firm Spark SPK.NZ fell around 4 percent.
Focus is on giant cooperative Fonterra's annual results on Thursday with investors looking for fresh clues on its farmgate milk price forecast.
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