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Oct 4 - Australian shares pared some of their early losses to close marginally higher, hurt by financials after the Reserve Bank of Australia held its cash rate at a record low of 1.5 percent.
The S&P/ASX 200 index .AXJO nudged up 0.1 percent or 5.4 points to 5,484 at the close of trade.
Investor sentiment took a hit after stronger-than-expected U.S. manufacturing data for September bolstered expectations of a December interest rate hike by the Federal Reserve.
Shares in three of the "Big Four" banks in Australia weakened, while Australia and New Zealand Banking Group ANZ.AX ended 0.3 percent up.
Plumbing solutions provider Reliance Worldwide RWC.AX was the biggest loser on the S&P/ASX 200 index .AXJO , slackening to a three week low following research-firm Deutsche Bank's price target downgrade.
Dacian Gold DCN.AX was among the biggest losers on the metals index .AXMM , falling as much as 6.6 percent, tracking a slip in gold prices that fell to a two-week low. Zealand's benchmark S&P/NZX 50 index .NZ50 eased 0.27 percent or 20.03 points to finish the session at 7,352.5, with utilities underperforming the sector.
Electricity and gas distributor Vector Ltd VCT.NZ lost 2.7 percent, falling for a fifth trading day out of six.
Exchange operator NZX Ltd NZX.NZ shed 2 percent after its CEO announced decision to step down at the end of the year.