January 6, 2016 / 2:08 AM / 5 years ago

Australia shares down 1.2 percent as China concerns linger

SYDNEY/WELLINGTON, Jan 6 (Reuters) - Australian shares extended losses for the fourth straight day on Wednesday falling 1.2 percent in light trade and amid cautious sentiment as investors eye China’s slowing growth.

China is Australia’s major trading partner.

The S&P/ASX 200 index fell 62.13 points to 5,122.3 by 0137 GMT. The benchmark fell 1.6 percent on Tuesday, a level last seen on Dec 24.

“It’s hard to read into it today because of the lack of volumes going through the market, but it is the fourth consecutive day of loses for the market which means every trading day in 2016 so far has been negative for the Aussie share market,” said Julia Lee, equities analyst, Bell Direct.

The major banks led the losses with Westpac down 0.95 percent followed by National Australia Bank, down 0.85 while ANZ lost 0.89 percent and Commonwealth Bank of Australia down 0.71 percent.

The materials sector came under pressure after iron ore prices fell 2.8 percent overnight.

“Once again, it looks like the bears taking over that materials/mining space,” Lee said.

Fortescue Metals Group fell 6.07 percent, while Rio Tinto lost 2.7 percent and BHP Billiton down 2.1 percent.

Among the retailers, leading grocer Woolworths slipped 1.27 percent while rival Coles rose 0.12 percent.

Mineral explorer Ardiden Ltd jumped 71 percent, its highest level in three years on Canada lithium project buy.

Communications service provider Spark New Zealand rose as much as 3 percent after being upgraded by brokerage Morningstar.

Asian stocks were subdued as floundering crude oil prices continued to dampen risk sentiment. Risk markets were waiting to see how Chinese equities will fare later in the session.

Wall Street offered little direction after a 2.5 percent drop in Apple Inc. weighed on all three major indexes cutting short a feeble recovery.

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New Zealand’s benchmark NZX 50 index slipped 0.22 percent or 14.27 points to 6,263.83.

The biggest gainers were Xero, which added 1.6 percent and Spark, which was up 1.5 percent.

The biggest losers were Sky TV, down 2.4 percent and Kathmandu, down 1.9 percent.

Shares in Fonterra’s fund, which provides investor exposure to the farmer-owned dairy exporter, fell 0.65 percent. Dairy prices fell in the overnight GlobalDairyTrade auction, adding to the view that Fonterra might not make its forecast payout to its 10,500 farmer shareholders for the current season.

Editing by Sam Holmes

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