September 13, 2018 / 6:53 AM / 2 months ago

Australian shares fall, inquiry testimony hits financials; NZ up

* Aussie shares end lower for a 10th session out of eleven

* Financials fall on disclosures at Royal Commission

* Materials bounce on recovery in commodity prices (Updates to close)

Sept 13 (Reuters) - Australian shares fell n Thursday as banks and insurers were pummelled by damaging testimony of a powerful inquiry, though gains in miners on a recovery in commodity prices capped the losses.

The S&P/ASX 200 index fell 0.8 percent or 47.2 points to 6,128.7 at the close. The benchmark ticked down 3.80 points on Wednesday.

Financials accounted for most of the losses on Thursday, hurt by the latest revelations of a year-long inquiry into Australia’s financial sector misconduct.

The insurance arm of Commonwealth Bank of Australia (CBA) rejected a trauma payout to a customer using outdated criterion that found his heart attack was not severe enough, the inquiry heard on Wednesday.

On Thursday, it was told that Australia’s corporate regulator allowed an insurer to make a A$300,000 community donation to resolve cases of misleading advertising which could have drawn fines of up to A$8 million ($5.7 million).

CBA fell about 1 percent on Thursday, while Australia and New Zealand Banking Group Ltd dropped 1.1 percent to a more than two and a half month low.

Drugmaker CSL Ltd, an index heavyweight, dropped 2.7 percent to a four-week low and was the top drag on the benchmark.

Shares of biggest grocer Woolworths Group, which were trading ex-dividend, fell 3.2 percent to a more than four-month low.

Bucking the trend, materials rose, underpinned by a recovery in base metals prices and a jump in Dalian iron ore futures.

Anglo-Australian miner BHP firmed 0.7 percent to a one-week high and was the biggest boost to the benchmark, and peer Rio Tinto Ltd rose 1.7 percent.

In New Zealand, the benchmark S&P/NZX 50 index strengthened 0.6 percent or 53.42 points to finish at 9,248.99.

Health care stocks and consumer discretionary led the gains, with Fisher & Paykel Healthcare Corporation Ltd rising about 1 percent, while Trade Me Group Ltd surged 3.8 percent. (Reporting by Aditya Soni in Bengaluru; Editing by Richard Borsuk)

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