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Mining, gold stocks drag Australia shares lower on rising virus cases

Credit: REUTERS/DAVID GRAY

Australian shares snapped a three-day rally on Thursday, with losses in mining and gold stocks dragging down the resource-heavy benchmark index amid growing concerns over a surge in coronavirus cases.

By Yamini C S

Aug 26 (Reuters) - Australian shares snapped a three-day rally on Thursday, with losses in mining and gold stocks dragging down the resource-heavy benchmark index amid growing concerns over a surge in coronavirus cases.

The benchmark ASX 200 index .AXJO lost 0.54% to end at 7,491.2 as new daily COVID-19 cases in the country topped 1,000 on Thursday for the first time ever.

Focus was now on the upcoming Jackson Hole Symposium on Friday in hopes that the U.S. Federal Reserve does not change its stance on policy tightening.

"I think... (Fed chair) Jerome Powell is basically going to repeat what he said before and give no guidelines on tapering," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.

Investors are also bracing for a more hawkish stance from some of the major central banks around the world, following a surprise move by the South Korean central bank to raise its policy rate for the first time in nearly three years.

"South Korea putting up rates has started the capital wars, as we're beginning to see risk come into the market....and the money is looking to leave Australia," Somasundaram added.

Miners .AXMM fell 1.6% on weaker copper prices, with global miners Rio Tinto RIO.AX, BHP Group BHP.AX and Fortescue Metals losing about 1% each. MET/L

Gold stocks .AXGD led declines on the benchmark, shedding 2.3% on subdued bullion prices, with Tribune Resources TBR.AX falling the most. GOL/

Financials .AXFJ fell 0.2%, with one of the "Big Four" lenders, National Australia Bank NAB.AX slipping 0.5% after it was fined A$18.5 million ($13.43 million) for issuing incorrect fee disclosure statements in a 2019 case.

Tech stocks .AXIJ lost 1.2%, with Appen Ltd APX.AX and Link Administration LNK.AX leading losses on both the sub-index and the broader benchmark, down 21% and 12.6%, respectively.

New Zealand's benchmark S&P/NZX 50 index .NZ50 fell 0.9% to 13,051.62.

Dairy firms A2 Milk Company Ltd ATM.NZ and Synlait Milk Ltd SML.NZ were the top losers, down 11.3% and 6%, respectively.

($1 = 1.3772 Australian dollars)

(Reporting by Yamini C S in Bengaluru; Editing by Rashmi Aich)

((Yamini.CS@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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