* Financial sector in the red
* China devalues yuan
* Resources sector props up the index (Adds analysis, quotes, stocks on the move)
By Pauline Askin and Gyles Beckford
SYDNEY/WELLINGTON, Aug 11 (Reuters) – Australian shares gave up early gains to fall 0.5 percent on Tuesday as investors booked profits in most sectors after China devalued its currency following weaker-than-expected economic data.
The S&P/ASX 200 index fell 28.36 points to 5,480.8 by 0349 GMT. The benchmark, trading near one-month lows, gained 0.6 percent on Monday.
“It was the weakness in the Chinese economic data coming in well below expectations … and the Chinese have just devalued their exchange rate,” Damien Boey, equity strategist, Credit Suisse said.
China’s central bank sharply weakened the yuan on Tuesday, saying it had changed the way it calculated the currency’s daily midpoint against the dollar. China is Australia’s No.1 trading partner.
Australian business confidence eased back in July as mining and construction firms turned more cautious.
Banks weighed heavily on the index with National Australia Bank falling 2.3 percent and Westpac Bank down 1.9 percent.
Bendigo and Adelaide Bank fell as much as 4.5 pct to their lowest since June 16.
But it wasn’t all doom and gloom, resources remained in the black with global mining giants Rio Tinto (LSE: RIO.L – news) and BHP Billiton up 1.5 percent each.
Gold (Other OTC: GDCWF – news) miner Evolution Mining Ltd rose as much as 8.9 percent after an agreement was signed with Edna Berly Mining . [ID: nL3N10M1GL]
Liquefied Natural Gas Ltd rose 10.14 percent and Paladin Energy (Other OTC: PALAF – news) jumped 12.5 percent.
For more individual stocks activity click on New Zealand’s NZX50 share index hit a two week low easing 0.2 percent to 5,852.02, as the earnings season got underway offering a mixed bag.
Agribusiness company PGG Wrightson fell 2.1 percent as it said it would feel the headwinds from the weaker dairy sector, as it reported a lift in operating earnings but lower net profit for the past year.
Going the other way was retirement village operator Summerset gaining 2.2 percent after reporting a doubling in first half profit and reaffirming its full year guidance.
Property For Industry (NZSE: PFI.NZ – news) edged higher as first half profit more than doubled and it said it planned to raise NZ$ 49.5 million through a share issue to fund growth.
Casino operator Sky City reports full-year earnings on Wednesday with expectations for a modest lift in underlying profit to around NZ$ 131 million.
Elsewhere, retailer and takeover target Kathmandu was 2.3 percent lower as key shareholders said they were unlikely to accept Briscoe Group’s offer at its current level. (Editing by Kim Coghill)
