October 28, 2019 / 6:49 AM / a month ago

Australian shares flat, resources offset losses in financials

(Updates to close)

Oct 28 (Reuters) - Australian shares ended little changed on Monday, with the resource sector buoyed by expectations Washington and Beijing were close to finalising a trade deal, which helped outweigh weakness in financials.

Officials from the United States and China said they were “close to finalising” some parts of a trade agreement after high-level telephone discussions on Friday.

However, encouraging signals in the past have proved short-lived and continuing uncertainties kept investors cautious.

The S&P/ASX 200 index closed at 6,740.7, its highest since the start of the month. The benchmark had firmed 0.7% on Friday.

Global miner BHP Group and iron ore miner Fortescue Metals Group were the biggest gainers, up 1.1% and 2.2%, respectively.

China is Australia’s largest trading partner, with miners especially exposed given China’s huge appetite for commodities to meet its growth needs.

Energy stocks also supported the market, despite a drop in oil prices.

Woodside Petroleum Ltd, the country’s largest oil and gas company, traded marginally higher, while smaller rival Beach Energy climbed 2.1%.

Fuel refiner Viva Energy Group Ltd rose as much as 4.1% after posting a sharp increase in quarterly refining margins from the preceding quarter.

Among the banks, Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp all ended lower, while Australia and New Zealand Banking Group was flat.

An Australian court found that Westpac staff inappropriately gave personal financial advice when marketing pension funds, overturning an earlier ruling.

Meanwhile, metals and electronics recycler Sims Metal Management was down 8.8% after forecasting an underlying core earnings loss for the first half due to weakness in scrap prices.

New Zealand’s benchmark S&P/NZX 50 index remained closed for Labour Day. The index closed 0.4% lower on Friday. (Reporting by Nikhil Kurian Nainan in Bengaluru Editing by Jacqueline Wong)

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