May 30, 2018 / 6:39 AM / 23 days ago

Australian shares dragged lower by Italian turmoil, but NZ higher

* Global tensions drive index lower, banks weigh

* Investors seek safe haven in gold, pharma stocks

* NZ stocks higher on telecom & consumer stocks (Updates to close)

May 30 (Reuters) - Australian shares ended lower on Wednesday as global equities reeled from the political crisis in Italy, which drained risk appetite and sent investors into safe haven assets like U.S. Treasuries.

The S&P/ASX 200 index closed at its weakest since April 30, dropping 0.4 percent or 28.9 points to 5984.7 as investors opted for defensive plays.

Due to inconclusive elections in March and failed attempts to form a government, Italy may hold fresh elections as early as July, sparking fears it could become a disruptive de facto referendum on the European Union and the euro.

Adding to the pressure, Australia’s housing activity slowed in April with approvals to build new homes down more than expected while non-residential permits also slipped in an ominous sign for economic growth.

Banks accounted for most of the ASX’s losses with the index of financial stocks falling 1.4 percent to its worst close in well over a year.

Australia’s “Big Four” banks lost between 0.9 percent and 2 percent, with Australia and New Zealand Banking finishing at its lowest in a month after its New Zealand arm agreed to sell its New Zealand life unit to U.S-listed Cigna Corp for NZ$700 million ($484.12 million)

Mining stocks fell 0.4 percent on weakness in metal prices, with global miners Rio Tinto and BHP Billiton losing 1.2 percent and 0.3 percent, respectively.

Some investors took shelter in defensive stocks, driving the gold and healthcare indexes up 1 percent and 0.7 percent, respectively.

Index heavyweight gold producer Evolution Mining rose 1.3 percent while Saracen Mineral Holdings gained 2.4 percent.

Healthcare stock CSL Ltd was the top boost to the benchmark, rising 1 percent to a record close, with a weaker Australian dollar making pharmaceutical exports more competitive.

New Zealand’s benchmark S&P/NZX 50 index closed 0.1 percent higher or 12 points to 8647.86.

Telecom and consumer staple stocks led gainers on the index, with telco Spark New Zealand Ltd and dairy producer A2 Milk Company Ltd ending up 1.8 percent and 3.1 percent, respectively.

The central bank said the financial system is better prepared to weather any unforeseen global shocks that could push up borrowing costs ($1 = 1.4459 New Zealand dollars) (Reporting by Devika Syamnath in Bengaluru; Editing by Kim Coghill)

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