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Oil slump drags down Australian shares

BBC News BBC News 4/05/2016
Oil rig nodding donkey© Getty Images Oil rig nodding donkey

Australian stocks fell on Wednesday following an overnight slump in oil prices.

The resource-heavy S&P ASX 200 index closed down 1.5% at 5,271.10.

Shares in energy giant Rio Tinto finished 7.8% lower, while Woodside Petroleum lost 5%.

Oil prices fell overnight on renewed fears of a supply glut. According to industry data, output from Middle East producers jumped last month and may continue to rise in the short term.

Additionally, a US government report due out on Wednesday is expected to show that US crude stockpiles are at a record high.

Brent crude, which is used as an international benchmark, was down 1.9% overnight at $44.97 a barrel. Prices edged higher in Asian trade to just above $45.

Shares in BHP Billiton fell more than 9% in Australia following news of a lawsuit in Brazil. Prosecutors in Brazil filed a $43.5bn (£30bn) civil lawsuit against iron miner Samarco, and its owners BHP Billiton and Vale.

In China, the Shanghai Composite has down 0.2% at 2,986.19, while in Hong Kong the Hang Seng index fell 228.40 points, or 1.1%, to 20,451.95.

In South Korea, the benchmark Kospi index closed down 0.5% at 1,976.71 points.

Markets in Japan are shut for three days of national holidays and will re-open on Friday.

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