September 2, 2019 / 1:55 AM / 2 months ago

Australia shares flat as fresh trade tariffs take effect

* Weaker oil prices hit energy firms

* Gold stocks gain

* NZ benchmark inches up

By Aby Jose Koilparambil

Sept 2 (Reuters) - Australian shares were little changed on Monday as investors stayed cautious, contemplating the after-effects of another round of tariff hikes in the festering trade war between the United States and China.

Beijing and Washington began imposing additional tariffs on each other’s goods on Sunday, the latest escalation in a bruising trade war, but U.S. President Donald Trump said the sides would still meet for talks later this month.

The S&P/ASX 200 index was down 0.06% to 6.600.80 by 0136 GMT, after gaining more than 1% on Friday.

“The uncertainty related to the trade situation is persisting. The leads are negative this morning with the oil sector declining on lower prices,” said James McGlew, executive director of corporate stockbroking at Argonaut.

Energy stocks led the declines as crude futures were impacted ahead of a hurricane near the Florida coast, as closed refineries threaten to dampen demand.

Hurricane Dorian, the second strongest Atlantic storm on record, pounded two Bahamian islands on Sunday night and was forecast to move close to Florida in the next two days, according to U.S. forecasters.

Oil retailer Viva Energy Group and gas firm Santos Ltd fell as much as 2% each.

Fertiliser and explosives producer Incitec Pivot Ltd , was the top percentage loser on the benchmark after it said it would review its fertiliser business and lowered its operating profit forecast due to drought and increased costs.

The main retailers were all trading in the red after the country’s largest supermarket operator Woolworths Ltd on Friday gave investors little cause of optimism about a rebound in consumer spending.

Woolworths declined as much as 1.6% while its smaller rival Coles Group Ltd lost about a percent.

The Metals and Mining sector provided the pocket of relative strength in early trade, with the sub-index gaining as much as 0.7%.

Gold stocks propelled the sector as bullion gained being the safe-harbour asset at times of broader worries in the equities markets.

Dacian Gold put on about 3% while Evolution Mining tacked on more than 1.3%.

Overall gains in the metals sector were pulled down by iron-ore focused miner Fortescue Metals Group, which lost up to 1.8% trading ex-dividend.

The heavyweight Financials index was little changed in morning trade.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index rose 0.1% to 10,769.10 with communication services provider Chorus Ltd leading the gains, putting on more than 2%. (Reporting by Aby Jose Koilparambil in Bengaluru)

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