Australian shares slip as iron ore hits 5-year lows

Reuters - UK Focus

(Fixing word in headline)

* ASX 200 slips as resources hit by iron ore rout

* 78 shares higher, 105 shares lower, 17 unchanged

* Volumes light as investors stay on sidelines

By Thuy Ong and Gyles Beckford

SYDNEY/WELLINGTON, Sept 5 (Reuters) - Australian sharesdipped 0.2 percent on Friday with the resource sector hit by arout in iron ore prices and sentiment hurt by Wall Street'sdecline, though an uptick by defensive stocks offset losses.

Miners also lost ground as spot iron ore prices fell totheir lowest in nearly five years. Global iron ore miners BHPBilliton Ltd and Rio Tinto Ltd (Xetra: 855018 - news) lost 1.2percent and 1.3 percent respectively.

The country's top lender by assets, National Australia Bank declined 0.5 percent while Westpac Banking Corp, Australia's second biggest bank by market value, wasflat.

The S&P/ASX 200 index lost 13.5 points to 5,617.8 by0200 GMT. The benchmark, which shed 0.4 percent on Thursday, wasdown 0.1 percent for the week.

The benchmark sunk to a trough of 5,425.2 on Aug. 8 but hassince jumped some 200 points on the back of a mixed earningsseason to hit a six-year peak of 5,679.5 on Aug. 21. The localbourse has been trading sideways since, as many investors sat onthe sidelines hoping geopolitical tensions would ease.

"We won't know what will lead the market because all recentindicators aren't very clear and quite mixed," said Biyi Cheng,head of Asia-Pacific dealing at City Index, referring to mixedunemployment and Chinese data.

"That's why the market would like to stay sideways - notmuch money is flowing in to give it direction."

Volumes in morning trade were low, with 187.3 million sharestrading hands by 0202 GMT, compared to a five-day daily movingaverage of 420.8 million shares.

Some top 20 stocks on the ASX 200 underpinned sentiment,with Wesfarmers Ltd adding 0.4 percent, whileAustralia's biggest telecommunications provider TelstraCorporation Ltd, edged 0.1 percent higher.

G8 Education Ltd jumped 3.2 percent to an all-timehighs of A$5.60 after saying it has settled 14 childcare andeducation centres, with the acquisitions funded from existingcash reserves.

Elders Ltd plunged 6.7 percent after selling its 50percent interest in AWH Pty Ltd to DP World Australia for A$30million plus 50 percent of the cash at bank held by AWH.

New Zealand stocks were modestly firmer with the benchmarkNZX-50 index gaining 0.2 percent to a one week high of5,243.17.

Among the top stocks, retirement village operator RymanHealthcare Ltd rose 1.8 percent to NZ$8.00. Powercompany Contact Energy Ltd (NZSE: CEN.NZ - news) and Auckland InternationalAirport Ltd both gained 0.9 percent, which offset a 2.9percent fall for software company Xero Ltd.

Small-and-mid cap stocks showed some of the strongest gainswith AWF Group Ltd, which hires out temporary staff, up6.9 percent to NZ$2.65 after it said it expected to report asolid lift in earnings and profit.

Retailer Briscoe Group Ltd was at a record high ofNZ$3.00, up 3.5 percent, as it basked in the previous day'srecord first half profit, and bio-technology firm Pacific Edge extended the previous day's gains, rising a further 6.7percent to NZ$0.96.

The part-privatised state power companies Genesis Energy Ltd, Mighty River Power Ltd and Meridian EnergyLtd were also solid performers, gaining between 1.2and 2.8 percent. (Editing by Richard Borsuk)

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