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Australia shares fall as commodities slide hits resources

Published 18/11/2015, 12:40 pm
© Reuters.  Australia shares fall as commodities slide hits resources
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* Copper, iron ore, oil, gold all lower

* BHP to face shareholder pressure at Thurs AGM

* Terrorism, geopolitics also weigh on investors

SYDNEY/WELLINGTON, Nov 18 (Reuters) - Australian shares fell on Wednesday as slumping oil, copper and gold prices dragged down resources stocks while concern that BHP Billiton (L:BLT) BHP.AX may stop increasing dividends sent the world's largest miner to a seven-year low.

A bomb scare in Europe only days after the deadly Paris attacks also put investors in a cautious mood, preferring to invest in safe-haven U.S. bonds and the dollar.

Overnight, the prices of copper, iron ore, oil and gold hit multi-year lows on a combination of geopolitical concerns and expectations that demand from key importer China would slow.

By 0100 GMT, the S&P/ASX 200 index .AXJO was down 23.6 points or 0.5 percent to 5,094.6, giving up part of the previous day's 2.3 percent rally. The benchmark is down 6 percent this year.

"All the commodities last night had a shocker, and it's transferred into our equity market," said IG Markets strategist Evan Lucas.

"BHP is probably, from an equity side, the biggest concern around. It is really, really under huge pressure," he said.

BHP shares were down 2.7 percent at A$19.83 after hitting their lowest intraday level since 2008. The stock failed to trade over A$20.00, having last closed below that level in 2005.

At its annual shareholder meeting on Thursday, the miner is expected to face intense questioning about a fatal dam collapse at a Brazil mine it partly owns and about whether BHP can maintain its policy of steadily raising dividends.

Rival Rio Tinto (L:RIO) RIO.AX was down 2 percent, while world No. 4 iron ore producer Fortescue Metals Group slid 3 percent.

Energy stocks fared little better, in line with the oil price decline. Woodside Petroleum WPL.AX was down 1 percent, Oil Search OSH.AX dropped 1.5 percent and Santos STO.AX eased 0.7 percent.

Retailers also declined, with No. 1 grocer Woolworths WOW.AX down 0.6 percent and Wesfarmers WES.AX , which owns smaller rival Coles, off 1 percent.

Westpac Banking Corp WBC.AX fell 1 percent while Commonwealth Bank of Australia CBA.AX and National Australia Bank NAB.AX were steady.

New Zealand's benchmark NZX 50 index .NZ50 rose 0.2 percent or 9.5 points to 5,977.10.

The biggest gainers were Steel & Tube STU.NZ , up 2.3 percent, and A2 Milk ATM.NZ , which continued to benefit from upbeat guidance on Tuesday, adding 1 percent.

Among the biggest losers were accounting software firm Xero XRO.NZ , down 0.9 percent, and Mighty River Power MRP.NZ , down 1.4 percent.

For more individual stocks activity click on STXBZ

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