By Aparajita Saxena
May 26 (Reuters) - Australian stocks were beaten lower on Friday by a downturn in commodity prices, especially oil, after the extension of output curbs by OPEC disappointed investors who hoped for larger cuts.
The S&P/ASX 200 index .AXJO fell 41.13 points or 0.71 percent to 5,748.5 by 0304 GMT.
Oil prices tumbled 5 percent on Thursday, their biggest daily percentage slide since early March. O/R
The local energy index .AXEJ fell as much as 2.63 percent, its biggest intraday slide in nearly three weeks.
Shares of oil companies such as Woodside Petroleum WPL.AX and Oil Search OSH.AX dropped nearly 3 percent.
For BHP Billiton (LON:BLT) BHP.AX , a major iron ore miner that has increased its exposure to oil in recent years, it was bad news all around - Chinese iron ore futures slumped 4 percent on Thursday, falling for a third day in a row, while three-months LME copper CMCU3 shed nearly 0.2 percent on Friday.
Spot iron ore prices were on course to post their third weekly fall in four, pressured by plentiful supply in top consumer China and a retreat in Chinese steel prices. combination of those factors battered BHP shares, which fell as much as 3.06 percent, their biggest intraday slip in three weeks.
Other iron ore miners followed suit - Fortescue Metals Group FMG.AX slumped to its lowest in around two weeks, while Rio Tinto (LON:RIO) RIO.AX fell as much as 2.36 percent.
The metals index .AXMM , which tracks 38 mid to large-cap mining companies, fell as much as 2.3 percent, its biggest intraday decline in three weeks.
Financials .AXFJ continued to decline, led down by sliding share prices of "Big Four" banks. Wealth manager AMP Ltd AMP.AX tumbled 1.4 percent.
Another loser early Friday was Telstra TLS.AX , off a percent, after the competition watchdog's decision on regulation of high-speed internet services was seen increasing the chance of more competition. Moradi, an equity strategist with Lonsec, said he expects a "positive end to the month" for Australian shares as most U.S. indices are at all-time highs.
"We can probably expect a positive performance in June as well, the way that the U.S. markets are heading."
New Zealand's benchmark S&P/NZX 50 index .NZ50 dipped 0.07 percent or 5.46 points to 7,429.01, led by utilities.
Entertainment company Skycity Entertainment SKC.NZ was the index's worst performer, down 2.0 percent at one point, its biggest intraday slide in over a month.
Electricity-retailer Meridian Energy MEL.NZ slipped as much as 1.71 percent.
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