Sept 24 (Reuters) – Australian shares pared early losses on Thursday after data showed the unemployment rate rose more than expected, though investors continued to price in the risk of a hawkish move from the central bank at its policy meeting next week.
The S&P/ASX 200 index was down 0.8% at 8,693.30, as of 0200 GMT. The index fell as much as 1.4% earlier in the session, hitting its lowest since June 12.
Data from the Australian Bureau of Statistics showed net employment rose 39,500 in August from July, above market forecasts for a 20,000 increase.
However, the jobless rate rose to a five-year high of 4.6%, above forecasts for a steady 4.5% climb.
Reserve Bank of Australia Governor Michele Bullock said on Tuesday unemployment in a range of 4.5% to 5.0% could help restrain inflation.
Market pricing was little changed following the data, with investors continuing to price in a 25-basis-point rate increase at the central bank’s September 28-29 meeting.[0#AUDIRPR]
Higher rates can weigh on equities both by raising the cost of financing corporate investment and by luring buyers back into the bond market.
Resources was among the major laggards with a 1.8% drop, as copper prices fell from near-record highs on a stronger U.S. dollar. BHP and Rio Tinto fell 2.1% and 0.7%, respectively.
Separately, operations at BHP’s Escondida copper mine in Chile were suspended after a worker was killed in an accident.
Financials slipped 0.9% and were set for their steepest drop in more than a week. All “Big Four” banks declined between 1.1% and 1.7%.
Rate-sensitive real estate and consumer staples stocks lost 1.5% and 0.3%, respectively.
Energy was among the few sectors trading in positive territory, advancing 1% after a sharp rally in oil prices overnight. Woodside Energy and Santos climbed 1.1% and 1.6%, respectively.
In New Zealand, the benchmark S&P/NZX 50 index was last down 0.5% at 13,757.14.
(Reporting by Nikita Maria Jino and Keshav Singh Chundawat in Bengaluru; Editing by Subhranshu Sahu)
