Australian shares set for worst day in over two weeks as miners, gold stocks drag

Australian shares headed for their worst session in more than two weeks on Friday, dragged lower by mining and gold stocks on softer prices, while escalating tensions in the Middle East continued to weigh on risk appetite.

The S&P/ASX 200 index fell 0.5% to 8,800.00, as of 0018 GMT, set for its biggest drop since July 1.

The benchmark has lost 0.1% this week.

Investors remained on edge as the Middle East conflict intensified, with both Iran and the US stepping up their attacks to largely unravel last month’s truce.

Miners lost 2.9%, their worst session in nearly a month, with BHP and Rio Tinto falling 2.7% and 2.4%, respectively.

Gold stocks added to the material sector slump, falling as much as 4.3%, the lowest since June 11 on weaker bullion.

The sub-index has lost over 6.5% so far this week, set for its biggest weekly drop since mid-March.

Both Evolution Mining and Northern Star Resources dropped 3.6% each.

Financials slid 0.4% but is set for its third consecutive weekly gain.

All the “Big Four” banks fell between 0.2% and 1%.

Capping losses, grocer Coles’ shares gained as much as 5%, their best day since March and propelled the consumer staples sub-index up 2.4%, setting it up for its best session since June 10.

Australia’s No. 2 grocer said it has ended talks to acquire Greencross Pet Wellness from US private equity firm TPG Capital. Energy stocks gained 1.8%.

They are up 1.9% this week, poised for a third straight weekly gain. Santos and Woodside Energy jumped 1.1% and 3.3%, respectively.

Further south, New Zealand’s benchmark S&P/NZX 50 index was flat at 13,614.21.

It has lost nearly 0.8% this week and is on track for its worst week since the week ended May 15.