The stock market in Australia closed lower on Wednesday, dragged by banks on concerns about the global economy after retail sales declined in the U.S., the world's largest economy, during March. However, mining stocks advanced, helping to limit the losses

In the U.S., the Commerce Department said retail sales fell 1.1% month-over-month in March following an upwardly revised 0.3% increase in February. In another report, the Labor Department said that its producer price index fell 1.2% in March compared to economist estimates of a flat reading. Core producer prices, which exclude food and energy prices, were unchanged compared to the previous month.

Nevertheless, better than expected financial results from Goldman Sachs and Johnson & Johnson as well as positive comments from President Barack Obama and Fed Chairman Ben Bernanke reduced the losses on Wall Street. The Dow closed down 137.63 points or 1.7% at 7,920, the Nasdaq closed down 27.59 points or 1.7% at 1,626 and the S&P 500 closed down 17.23 points or 2.0% at 842.

After the markets closed on Wall Street, Intel Corp. reported a 55% drop in profit for the first quarter of 2009 on lower revenues and deteriorating margins. However, the earnings beat analysts expectations.

In Asian trading, crude oil ended $0.01 down at $49.40 a barrel in electronic trading. Light sweet crude for May delivery dropped $0.64 to $49.41 a barrel on Tuesday amid choppy trading.

The benchmark S&P/ASX 200 index lost 5.4 points, or 0.14% to 3,748, and the broader All Ordinaries index dropped 4 points, or 0.11% to 3,694.

Banking stocks ended weaker. Commonwealth Bank of Australia edged down 0.82%, ANZ Banking Group lost 1.81%, and National Australia Bank fell 3.07%. Macquarie Group slipped 1.43% while Westpac Banking bucked the trend and edged up 0.17%.

In the resources sector, index leader BHP Billiton advanced 1.51% and Rio Tinto gained 1.08% ahead of its annual general meeting at London later today. Gold related stocks ended mixed following a decline in gold prices in Sydney. Lihir Gold lost 0.33%, but Sino Gold advanced 5.31% and Newcrest Mining gained 1.31%.

Energy stocks declined on lower oil prices. Woodside lost 1.12%, Santos edged down 0.59%, and Oil Search fell 0.75%.

In the retail sector, David Jones shed 0.65%, but Wesfarmers gained 1.64% , and Woolworths advanced 1.23%. Harvey Norman, which reported 3.6% rise in total sales for the nine-month period, remained unchanged from the previous close.

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