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Australian shares extend losses to 5th day as Sino-U.S. trade row escalates

Published 06/08/2019, 05:07 pm
Updated 06/08/2019, 05:10 pm
© Reuters.  Australian shares extend losses to 5th day as Sino-U.S. trade row escalates
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* Aussie benchmark down 2.4%, banks weigh most

* Mining units trim losses, gold erases gains

* NZ rate decision on Wednesday, with 25bps cut all but inked (Updates to close)

August 6 (Reuters) - Australian shares fell more than 2% on Tuesday, extending losses to a fifth straight session, after Washington branded Beijing a currency manipulator, escalating a bruising trade dispute that is increasingly weighing on global demand and financial markets.

The S&P/ASX 200 index .AXJO ended down 2.4% or 162.2 points at 6,478.1.

It has lost nearly 5% since last Thursday when U.S. President Donald Trump said the U.S. would slap 10% tariffs on $300 billion of goods from China, Australia's top trade partner.

Financial stocks .AXFJ , which have the heaviest weighting in the index, collectively lost 2.4% and the "big four" banks declined between 1.7% and 2.6%.

Export-reliant healthcare firms .AXHJ such as CSL Ltd CSL.AX also ended lower, as the local currency AUD=D3 firmed against the greenback after Australia's central bank left interest rates unchanged at 1.0% as expected. China's yuan steadied after sharp losses on Monday, offering markets some relief. .SS

Data early in the day showed Australia's trade surplus swelled to an all-time high in June despite growing U.S. tariff pressure on China. jump in exports was attributed partly to high prices for iron ore - the country's single biggest earner.

Global miners BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX , both with significant exposure to iron ore, pared earlier losses to finish 0.8% and 0.1% lower, respectively.

Safe-haven gold stocks .AXGD such as Newcrest Mining NCM.AX came off eight-year highs to close 0.8% lower.

In New Zealand, the benchmark S&P/NZX 50 index .NZ50 fell 1.7% to 10,587.17. Vista Group International VGL.NZ , which develops software for the film industry, was the biggest decliner.

The country's central bank will review interest rates on Wednesday, with a 25 basis point cut all but confirmed, in line with global policy easing to fight slowing growth in the face of intensifying trade disputes.

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