* Global trade war fears weigh on investor sentiment
* BHP receives class action lawsuit over Samarco dam failure
* Gold stocks defy broad losses, as the yellow metal rises
By Nikhil Nainan
July 23 (Reuters) – Australian shares fell sharply on Monday as financial markets fretted over global trade war tensions after U.S. President Donald Trump threatened more tariffs on Chinese imports.
Financials were the biggest drag on the S&P/ASX 200 index , which fell 0.9 percent, or 55.9 points to 6,230.0 by 0200 GMT. The benchmark rose 0.4 percent on Friday.
Trump said on Friday he was ready to impose tariffs on all $500 billion of imported goods from China, as a trade dispute between the world’s two biggest economies intensified with no signs a resolution was near at hand.
Trump’s more aggressive protectionists policies have sparked retaliatory measures from countries around the world, rattling financial markets worried about the impact on global growth.
Christopher Conway, head of research and trading at Australian Stock Report said: “It’s a couple of factors coming together, but for the most part it is the trade war tensions that’s driving our markets lower.”
Financial stocks tugged on the benchmark, with the main financial index down one percent.
Westpac Banking and Commonwealth Bank of Australia led the losses among the ‘Big Four’ banks, down 1.2 percent and 1.1 percent, respectively.
Westpac’s wealth management unit, BT Financial Group, cut prices of its flagship platform at a time when its peers have retreated from their wealth businesses.
Shares of global miner BHP slipped 1.3 percent after it confirmed that it had been served with a class action lawsuit regarding the 2015 Samarco dam failure in Brazil. Last week, BHP said it expected a $650 million charge in its fiscal 2018 results on account of the failure.
The Aussie mining index was down 0.9 percent, as commodity prices remained pressured by global trade tensions.
Mining-to-home improvement conglomerate Wesfarmers was among the top losers on the benchmark. The firm expects the demerger of its Coles supermarket chain to be completed by November and plans to retain 15 percent of the spin-off.
Wesfarmers was down as much as 1.3 percent.
Gold stocks looked set to snap a recent run of losses as the U.S. dollar eased on Trump’s criticism of the Federal Reserve’s interest rate hikes.
After losing nearly 6 percent last week, the gold index was up 0.5 percent, with Evolution Mining the biggest boost.
New Zealand’s benchmark S&P/NZX 50 index slid 0.7 percent or 66.54 points to 8,889.0.
After closing flat on Friday following four straight sessions of losses, a2 Milk Company slipped into the red again, down over 3 percent at a near two-month low.
Fletcher Building and Spark New Zealand were the other big losers, down as much as 3.5 percent and 2.3 percent, respectively. For more individual stocks activity click on (Reporting by Nikhil Kurian Nainan in Bengaluru, additional reporting by Mensholong Lepcha Editing by Shri Navaratnam)