* Financials gain tracking Wall Street peers
* BHP cuts iron ore production guidance
* Metals & mining index falls most in nearly 4 months
By Aby Jose Koilparambil
April 17 (Reuters) - Australia shares struggled in early trade on Wednesday, weighed down mainly by mining stocks, although the losses were capped by gains in financials, which tracked their Wall Street peers.
The S&P/ASX 200 index fell 0.2 percent, or 10 points, to 6,267.40 by 0052 GMT. The benchmark rose 0.4 percent on Tuesday.
Miners came under pressure after the world’s top iron ore miner Vale SA said it expects to resume operations within 72 hours at its Brucutu mine in Brazil.
Australia’s big miners have gained over the past few months on concerns over tight supply after production disruptions at Vale following a dam mishap in January pushed up prices of iron ore to multi-year highs.
Diversified miners BHP Group Ltd and Rio Tinto fell 2.2 percent and 3.7 percent, respectively, while iron ore-focused Fortescue Metals Group dropped 7.4 percent.
Analysts at Jefferies said in a note that Vale’s Brucutu restart was a “small net negative in the short term” for Rio Tinto, BHP and Fortescue, and iron ore prices might pull back in the very near term.
“Based on leading economic indicators, including the re-acceleration of credit growth in China in the first quarter, we expect iron ore demand to gradually improve,” Jefferies said.
The metals and mining sub-index, the second largest benchmark constituent, slid as much as 2.3 percent, its biggest intraday percentage fall in nearly four months.
Separately, BHP on Wednesday followed its rival Rio Tinto by cutting its annual iron ore production forecast due to disruptions caused by a tropical cyclone that hit its quarterly output.
Gold firms also fell, with the sub-index dropping more than 2 percent, after bullion slipped to its lowest level of 2019.
Meanwhile, financials, the largest sector in the benchmark, firmed 1 percent, with all ‘Big Four’ banks advancing in the range between 0.7 percent and 1.1 percent.
Finance stocks were the biggest percentage winners on Wall Street too, underpinned by positive earnings including those from the world’s largest asset manager BlackRock.
Meanwhile, investors await a raft of Chinese data due at 0200 GMT, notably first quarter GDP, looking for leads on the health of Australia’s biggest trade partner.
China’s economic growth is expected to slow to a near 30-year low of 6.2 percent this year, a Reuters poll showed.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index advanced 0.4 percent to 9,943.80, with the local-listed shares of lenders Westpac Banking Corp and Australia and New Zealand Banking Group featuring among top percentage gainers. (Reporting by Aby Jose Koilparambil in Bengaluru Editing by Jacqueline Wong)