News: XIJ Banking, tech stocks drag Australian shares lower; economy grows modestly in Q2

	  AXJO ends 0.8% lower 

	  Banking stocks fall most since Aug 25  

	  NZ50 ends at lowest level since Dec. 20 

(Updates to close)

Banking and technology stocks dragged Australian shares lower on Wednesday, as data showed the country's economy grew modestly in the second quarter.

The S&P/ASX 200 index (xjo) ended 0.8% lower at 7,257.10, its worst drop since Aug. 25. The benchmark fell 0.1% on Tuesday.

Data showed the country's economy expanded by more than expected in the second quarter, driven by exports and investment, while household consumption remained weak as the Reserve Bank of Australia's (RBA) monetary tightening weighed on demand.

"Household consumption accounts for 50% of the economy when measured by expenditure. So the weakness in the consumer illustrated in the GDP suggests further weakness ahead," said Kerry Craig, a global market strategist at J.P Morgan.

Barclays warned of worsening headwinds against private spending and exports, and flagged a growth slowdown in the second half.

The RBA left interest rates unchanged for the third straight month on Tuesday after inflation eased by more than expected but reiterated that further tightening may be required to tame inflation.

"The wishful expectation that the RBA might have done its inflation-battle journey is deeply in question," said Hebe Chen, market analyst at IG Markets.

Financials .AXFJ fell for a second straight session, marking a 1.1% fall, their worst fall since Aug. 25, with the "big four" banks trading in the red.

Shares of Macquarie Group (MQG) fell 3.8% after the bank flagged sustained economic headwinds to its asset management division through the first half of 2024.

Tech stocks .AXIJ tracked Wall Street lower to end 1.5% down, their biggest drop since Aug. 25. Xero (XRO) and NEXTDC (NXT) fell 1.6% and 1.4%, respectively.

Bucking the trend, energy stocks .AXEJ tracked oil prices higher to jump about 1%, closing at their highest level since Aug 10.

Woodside Energy (WDS) added 1.3%, while Santos (STO) gained 0.6%.

New Zealand's benchmark S&P/NZX 50 index (nz50) lost 0.1% to 11,427.66, its lowest level since Dec. 20.