* Miners dominate the losses
* Gold stocks top gainers on safe-haven buying
* GrainCorp drops after flagging first annual loss in a decade
By Aditya Soni
Aug 2 (Reuters) - Australian shares saw their worst day in more than two weeks on Friday, with China-reliant miners leading the fall, after U.S. President Donald Trump said he will slap a 10% tariff on $300 billion of Chinese imports and could raise them further.
The S&P/ASX 200 index .AXJO fell 0.5%, or 30.8 points, to 6,758 by 0208 GMT. The benchmark slipped 0.4% on Thursday.
"If there was any doubt that the U.S.-China trade negotiations are drifting further apart, this latest trade escalation puts that debate to rest," Stephen Innes, managing partner at VM Markets Pte Ltd Singapore, said in a note.
The announcement on Thursday extends Trump's trade tariffs to nearly all China's imports into the United States. stocks .AXMM , whose primary export destination is China, dropped as much as 1.8% to their lowest since June 20.
Rio Tinto (LON:RIO) Ltd RIO.AX , the country's second-biggest company, slumped to a near three-month trough even as it delivered record interim payout and announced its highest margins in a decade. is Australia's top trade partner and a key buyer of its commodities exports, making it especially vulnerable to any slowdown in the world's No.2 economy.
The world's biggest miner BHP Group Ltd BHP.AX dropped to nearly two-month lows, while Fortescue Metals Group Ltd FMG.AX saw its worst day in over three years.
Lower iron ore prices also piled on the pressure as Brazil's Vale presented an upbeat outlook and said its joint-venture with BHP is likely to come online in the second half of the year. gold miners .AXGD soared to a more than eight-year peak as tariff threats sent investors scurrying to safe-haven assets.
Resolute Mining Ltd RSG.AX surged as much as 16.1%, its biggest intraday gain in three years and was the top gainer on the benchmark.
The heightened trade war fears also bolstered demand for shares of rare earths miner Lynas Corp LYC.AX , which saw its best day since May 31.
Earlier in the day, Lynas said it was conducting preliminary work on a waste disposal facility for its Malaysian plant, which is due for an operating licence renewal in September. Australia's largest bulk grain handler GrainCorp Ltd GNC.AX dropped to an eight-week trough after flagging its first annual loss in a decade. also declined, with No.2 lender Australia and New Zealand Banking Group Ltd ANZ.AX seeing its worst day in a month.
Meanwhile, New Zealand's benchmark S&P/NZX 50 index .NZ50 declined 0.4%, or 37.68 points, to 10,823.14.
Losses were dominated by locally-listed Australia and New Zealand Banking Group ANZ.NZ , which slid 2.6%, its sharpest intraday fall since May 17.