Australia shares hit 4-week lows, growth woes offset US optimism

(Corrects day of week in first paragraph)

* Underlying worries about global growth, slump in iron ore weigh

* Market unable to step up, marks 5th losing day

* Upbeat U.S. data not enough to lift sentiment

SYDNEY/WELLINGTON, Nov 21 (Reuters) - Australian shares edged down to a four-week low on Friday as underlying worries about a slump in iron ore prices and the demand outlook eclipsed encouraging U.S. economic data.

Data showing American factory activity in the mid-Atlantic region grew at its fastest in two decades and home resales jumped to their highest did little to take the edge off global growth worries.

"Whilst the U.S. is ticking along, it's not enough, particularly for a market like Australia which is very commodities dependent," said IG Markets strategist Stan Shamu.

Investors have been spooked by slowing growth in China, Australia's biggest export market. A tumble in the price of iron ore, the nation's biggest foreign exchange earner, triggered a selloff in miners.

"Some of the iron miners have ticked a little bit higher (but) I don't think anyone's really convinced that this is a stabilisation," Shamu added.

After opening slightly higher, the S&P/ASX 200 index was down 2.94 points or 0.1 percent to 5313.3 by 0132 GMT, its lowest since Oct. 20. The benchmark has now fallen for five straight sessions, and is trading at a 1 percent discount to its last close of 2013.

Iron prices stabilized some after falling to five-year lows this week. Global miners BHP Billiton (NYSE: BBL - news) and Rio Tinto (Xetra: 855018 - news) added 0.6 percent and 0.9 percent, respectively, while Fortescue Metals jumped 3 percent.

Oil producers also gained after a bounce in oil prices, led by Santos rising 2 percent, but other key sectors underperformed.

Among banks, Westpac Banking Corp dropped 0.7 percent and Australia and New Zealand Banking Group slipped 0.3 percent.

Struggling surf clothing retailer Billabong jumped 5 percent to A$0.68 on news it had experienced growth in the U.S. for the first time in years.

New Zealand's benchmark NZX50 index eased 0.5 percent to 5,501.37, led by losses in outdoorwear maker Kathmandu, while investors booked profits after shares hit a lifetime closing high of 5,537.99 on Thursday.

Kathmandu fell 6 percent to plumb a one-month low of $NZ2.80 after a profit warning.

(Reporting by Byron Kaye in Sydney and Naomi Tajitsu in Wellington; Editing by Shri Navaratnam)