Australian shares end flat as caution creeps in on Trump's tariff threat
By Rajasik Mukherjee
July 11 (Reuters) - Australian shares ended flat on Friday but posted a weekly loss, as U.S. President Donald Trump's latest tariff threats kept investors cautious, while rare earth miners rallied after a major deal in the United States boosted sector optimism.
The S&P/ASX 200 index .AXJO ended the day 0.1% lower at 8,580.1, losing about 0.3% for the week, with the benchmark a few points shy of its all-time high scaled last month.
Trump's latest tariff threats have rattled investor confidence, particularly for Australia, which already faces a 200% tariff on pharmaceuticals, one of its largest exports.
"There is a lot of caution about being over-exposed to equities when Trump could do or say anything," said Luke Winchester, portfolio manager at Merewether Capital.
Financials .AXFJ were the top drag on the benchmark, losing 0.5%. Three of the "Big Four" banks dropped, while ANZ Group ANZ.AX traded flat.
Winchester said the lenders were under pressure as the Reserve Bank of Australia's surprise rate decision this week led to a repricing of equities.
Healthcare .AXHJ slipped 0.3%, with biotech giant CSL Ltd CSL.AX falling 0.6%. Tech .AXIJ dropped 1% to its lowest since late May, while discretionary consumer stocks .AXDJ lost 0.8%.
The mining sub-index .AXMM was the only sector trading in green, gaining around 2% to hit its highest since June 12. It gained 0.8% for the week, logging its third consecutive week of gains.
Iron ore mining giants BHP Group BHP.AX and Rio Tinto RIO.AX added 2.9% and 2.4%, respectively.
Rare earth miners surged, led by Lynas LYC.AX jumping 17%, on hopes that a multi-billion dollar deal between the U.S. government and MP Materials MP.N to boost rare earths magnets will lift prices for the sector.
Johns Lyng JLG.AX soared to its highest since mid-February after agreeing to a takeover deal that values the building services provider at A$1.1 billion ($723.69 million).
New Zealand's benchmark S&P/NZX 50 index .NZ50 lost 0.6% to close at 12,686.68.
($1 = 1.5200 Australian dollars)
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