Australia shares end marginally lower as commodities drag

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Australian shares closed slightly down on Tuesday, as losses in mining and gold indexes offset gains in healthcare stocks, with weak economic data from China due to stringent COVID-19 curbs fanning concerns about a global recession.

The S&P/ASX 200 index ended 0.03% lower at 7,386.3, snapping a four-day rally. The benchmark ended 0.8% higher on Monday.

China, Australia’s top trading partner, recorded one of its worst GDPs for 2022 in nearly half a century, growing 2.9% in the October-December quarter, as harsh COVID curbs leading to a dent in economic activities fanned concerns of global slowdown.

“Putting aside the GDP data today, which confirmed a substantial slowing of the Chinese economy, the broader flow of data has been disappointing, such as continued fall in property prices and deterioration in trade,” ThinkMarkets Australia market analyst Carl Capolingua said.

Local investors will look forward to a key unemployment report on Thursday and fourth-quarter inflation next week, to see the trajectory which the Reserve Bank of Australia is likely to adopt regarding rate decisions.

Miners led declines, dropping 1.3%, as sentiment for the steel-producing ingredient was dented on bleak economic growth, with index majors BHP Group and Fortescue Metals falling about 1.1% and 1.3%, respectively.

Anglo-Australian miner Rio Tinto fell 1.2% after hinting that China’s reopening from COVID restrictions was set to raise near-term risks of labour and supply chain shortages.

Gold stocks also fell, slipping 1.8%, with sector leaders Newcrest Mining and Northern Star Resources trading 1.8% and 1.5% lower.

The healthcare index was the only notable gainer, advancing nearly 1%, with CSL Ltd rising 1.3%.

Origin Energy fell 2.1% after extending the exclusivity period for the second time to finalise a A$15.5 billion ($10.80 billion) buyout bid from a Brookfield-led consortium.

New Zealand’s benchmark S&P/NZX 50 index rose 0.6% to end at 11,881.0. ($1 = 1.4349 Australian dollars) (Reporting by Archishma Iyer in Bengaluru; Editing by Rashmi Aich)