Australia Shares fall on Iran's attacks on U.S. forces

The Australian share market slightly lower on Wednesday, 08 January 2020, as risk aversion selloff triggered on tracking losses on Wall Street overnight as Middle East tensions escalated after reports that Iran launched missiles against a U.S. air base in Iraq. Around late afternoon, the benchmark S&P/ASX200 index declined by 5.94 points, or 0.1%, to 6,820.50, while the broader All Ordinaries slid 9.56 points, or 0.14%, to 6,934.00.

Equity investors have been jittery since late last week amid uncertainty about the impact of rising tensions between the U.S. and Iran following the U.S. airstrike that killed top Iranian military commander Qasem Soleimani.

Iran had fired several rockets at two joint U.S.-Iraqi bases early Wednesday morning in retaliation for the killing of a top Iranian military leader. The strikes are retaliation for a US drone strike that killed a leading Iranian military general last Friday. Tehran has promised to retaliate for a U.S. airstrike that killed Iran's top military commander last week.

Shares of major miners were weak. Rio Tinto and BHP fell more than 1% each, while Fortescue Metals lost almost 1%.

In the banking space, ANZ Banking, Commonwealth Bank, National Australia Bank and Westpac Banking were down in a range of 0.5% to 1%.

Meanwhile, gold miners were notably higher after safe-haven gold prices rose for a tenth straight session overnight. Evolution Mining and Newcrest Mining were up in a range of 2% to 3%.

Oil stocks were also higher after crude oil prices rose more than 4% in Asian trading Wednesday on fresh tensions in the Middle East. Woodside Petroleum, Santos and Oil Search were up in a range of 1% to 2%.

In economic news, the latest survey from the Australian Industry Group or AIG revealed that the construction sector in Australia continued to contract in December, and at a faster rate, with a six-and-a-half-year low PMI score of 38.9. That's down from 40 in November and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction.

CURRENCY NEWS: The Australian dollar, sensitive to shifts in broader risk appetite, climbed against the U.S. dollar. The Australian dollar was trading at around $0.6868, climbing from an earlier low around $0.6847.

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