* Only 16 stocks gain on the benchmark
* Poor U.S. data and the U.S.'s latest trade war sparks worry
* Major banks come under pressure from different fronts
By Nikhil Nainan
Oct 3 (Reuters) - Australian shares dived on Thursday, wiping out about A$42 billion ($28.19 billion) in value as more weak U.S. data fanned worries about an economic slowdown there, made worse by Washington's latest trade salvo - this time against Europe.
Overnight, the United States said it will impose tariffs on $7.5 billion worth of goods from the European Union, triggering a shakeout in global markets already reeling from the protracted U.S.-China trade war. helping was data from the ADP (NASDAQ:ADP) National Employment Report showing hiring by U.S. private employers slowing further last month, reinforcing global recession fears and of a slowdown in the U.S. economy. benchmark S&P/ASX 200 index .AXJO tumbled 2.5% to more than one month lows, but by 0133 GMT it had pared some of those losses to be off 2.1%, or 141.8 points, to 6,498.1. The index had closed 1.5% lower on Wednesday after poor U.S. manufacturing data.
Traders are pricing in a more worrying trajectory for the global economy, said Pepperstone's Head of Research Chris Weston.
There was a broad sell-off across sectors in Australia, with gold stocks the only bright spot as investors sought safe-havens.
Just 16 out of the 200 stocks on the benchmark were in positive territory.
Financial stocks, led by the Big Four banks, were sold off heavily between 2.5% to 3.3%. Analysts have warned that the three interest rate cuts this year by the Reserve Bank of Australia and any further easing may inflict even more pain on their margins. Stanley downgraded National Australia Bank NAB.AX , and warned that all the major banks should lower their payout ratios and target higher capital levels instead.
On Wednesday, NAB nearly doubled the total amount it has set aside to repay wronged customers, adding further pressure on earnings. Its shares were down the most among its peers. stocks .AXEJ extended their declines as oil prices lost further ground, pressured by a rise in U.S. inventories. O/R
Woodside Petroleum WPL.AX dropped 3.3%, while Santos STO.AX fell 4.1%.
Global miners BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX slid 2.7% and 3.2%.
The economic gloom supported a safety-bid for gold, with local firm Newcrest Mining NCM.AX climbing 3.6%.
Agricultural firm Webster Ltd WBA.AX surged 54% to a nearly 16-month high after it received a A$854 million takeover offer by shareholder PSP Investments. Zealand's benchmark S&P/NZX 50 index .NZ50 fell to two-week lows after losing as much as 1.5% to 10,784.14.
The local listings of Westpac WBC.NZ and ANZ ANZ.NZ fell 3.3% and 3.2%, respectively.
The only major stock in the green was Fonterra Shareholders' Fund FSF.NZ , which gained 4%.
For more individual stocks activity click on STXBZ ($1 = 1.4899 Australian dollars)