December 17, 2018 / 12:36 AM / 10 months ago

Australian shares edge lower as financials drag; NZ down

* BHP boosts miners; announces special dividend amount

* Financials lead losses as global growth concerns persist

* Mineral Resources rises after sealing lithium JV deal

By Nikhil Nainan

Dec 17 (Reuters) - Australian shares fell on Monday as losses in financials outweighed gains in material stocks, as the market looks ahead to an important week of data.

A series of weak economic data from Europe and China, Australia’s largest trading partner, intensified global growth worries, although caution prevailed ahead of the U.S. Federal Reserve’s key policy meeting scheduled for the next two days.

The S&P/ASX 200 index fell 0.2 percent, or 9.3 points to 5,592.7 by 0023 GMT. The benchmark dropped 1.1 percent on Friday.

Financial stocks slid 1 percent with the country’s Big Four banks leading the losses.

Australia and New Zealand Banking Group was down the most, about 2.4 percent, while National Australia Bank fell 1.4 percent.

“We saw pretty strong pressure on financial stocks in U.S. and European trading. There are concerns that changes to the global growth outlook would mean banks are likely to be less profitable and that is not surprising given the leverage that banks have to the overall economic cycle,” said Michael McCarthy, chief strategist at CMC Markets and Stockbroking.

However, despite the global negative leads, mining stocks which are highly exposed to China were boosted by mining behemoth BHP Group, which added 1.4 percent.

The miner announced a special dividend of $1.02 per share and the completion of its off-market share buyback, as part of its promise to return $10.4 billion to shareholders from the sale of its U.S. shale business.

Shares of fellow miner Mineral Resources soared as much as 5.6 percent to a near two-week high on the back of news after market hours on Friday that it had finalised an agreement to form a lithium joint venture with U.S.-based Albemarle for $1.15 billion.

“Overall we are looking at a negative tone to trading but the caution means we are unlikely to run away with it,” McCarthy added.

In other news, Australia’s government forecast the strongest budget outlook in 10 years, possibly making room for tax cuts ahead of elections in less than six months.

New Zealand’s benchmark S&P/NZX 50 index dropped 0.5 percent or 41.19 points to 8,681.32, with the country’s largest banks, subsidiaries of Australia’s powerful lenders, leading the losses.

On Friday, the Reserve Bank of New Zealand said it was considering almost doubling the required capital banks would need to hold to bolster the financial system’s capacity to handle any shocks.

Local shares of ANZ were down 3.9 percent, while Westpac Banking Corp fell 1.3 percent. For more individual stocks activity click on (Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Stephen Coates)

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