News: FMG Australian shares flat ahead of potential rate hikes

May 3 (Reuters) - Australian shares were flat on Tuesday, with investors cautious ahead of the central bank meeting and the prospect of an aggressive U.S. rate hike, while losses in gold stocks and miners partially offset a positive lead from the Wall Street.

The S&P/ASX 200 index (xjo) was flat at 7,341.4 points, as of 0117 GMT. The benchmark closed 1.2% lower on Monday.

At a policy meeting due later in the day, the Reserve Bank of Australia is widely expected to hike interest rates by 15 basis points to 0.25%, according to a Reuters poll.

Trading remained volatile with traders also anticipating a further tightening by the U.S. Federal Reserve this week.

Tracking weaker bullion prices, gold stocks .AXGD fell nearly 1% to lead losses in the benchmark. The yellow metal is usually considered a hedge against inflation, but rate hikes will increase the opportunity cost of holding non-yielding bullion.

Australia's largest gold miner Newcrest Mining (NCM) was down 1.3%

The mining sub-index .AXMM dropped 0.7%, extending losses into a second session with heavyweights BHP (BHP) , Rio Tinto (RIO) and Fortescue (FMG) slipping between 0.3% and 1.5%.

Financials .AXFJ tumbled 0.35% ahead of the RBA's policy meeting, with the "Big Four" banks slumping nearly 1% each.

Aussie banks are set to report a further squeeze on interest margins in their upcoming results, dented by intense competition, though the prospect of recovery aided by central banks' rate hikes is expected to bolster their outlook.

Tech stocks .AXIJ tracked their Wall Street peers higher to climb 2% while ASX-listed shares of Block Inc (SQ2) surged nearly 5%.

Woolworths (WOW) lost up to 1.5% after the supermarket giant flagged stocking issues due to supply chain disruptions.

New Zealand's benchmark S&P/NZX 50 index (nz50) was flat at 11,778.93 points.