Australia shares slip on U.S. woes; jobs data lends some support

(Adds analysis, quotes, stocks on the move)

SYDNEY, Oct (KOSDAQ: 039200.KQ - news) 10 (Reuters) - Australian shares slipped 0.2 percent on Thursday as investors remained cautious with U.S. debt ceiling talks continuing and the partial government shutdown dragging on into a ninth day, but an uptick in local jobs data helped cap broader losses.

The local bourse hit a five-year high of 5,314.3 points on Sept. 7, but has since faltered and lost some 150 points to trade around 5,150 as the U.S. government shutdown weighs on investor sentiment.

"Fiscal fisticuffs in the U.S. continue to dominate headlines worldwide and unsettle investors," Niall King, sales trader at CMC Markets, said in a note to clients.

"As the clock ticks down and the bill-paying ability of the U.S. comes into question, the inevitable shudder of fear has been making its way down the spine of market participants around the globe."

Blue-chip miners lost ground after copper dropped to its lowest in three weeks. Iron ore heavyweights BHP Billiton Ltd and Rio Tinto Ltd (Xetra: 855018 - news) dropped 1.1 percent and 0.5 percent, respectively.

Gold producers also faltered after bullion fell nearly 1 percent. Evolution Mining Ltd slumped 8.1 percent while St Barbara Ltd (Other OTC: STBMF - news) tumbled 6.1 percent

The S&P/ASX 200 index fell 10.1 points to 5,142.9 by 0104 GMT. The benchmark edged 0.1 percent higher on Wednesday and has fallen for six out of the past 10 sessions as the U.S. fiscal deadlock has eroded appetite for risk assets.

Analysts and dealers said stocks were expected to continue to struggle amid ongoing concerns over the U.S. government shutdown and debt ceiling negotiations.

A handful of defensives fell, with consumer retail staple Woolworths Ltd losing 0.7 percent and blood products maker CSL Ltd (Other OTC: CMXHF - news) slipping 0.5 percent.

However, a better-than-anticipated Australian jobs report helped lift the market from session lows, while investors also cheered President Barack Obama's nomination of Federal Reserve Vice Chairwoman Janet Yellen to run the U.S. central bank.

The financials sector was mixed after a morning of volatile trade. Commonwealth Bank of Australia (Other OTC: CBAUF - news) slipped 0.2 percent, while National Australia Bank was flat and Westpac Banking Corp rose 0.2 percent.

Westpac is in a pole position to pick up the Australian assets being sold by Lloyds Banking Group (LSE: LLOY.L - news) , three sources with knowledge of the situation said.

Bank of Queensland Ltd jumped 7 percent to a three-year high of A$11.18, after approving a final fully franked dividend of A$0.30 per share, with full year revenue from ordinary activities up 6 percent at A$855.9 million.

Virgin Australia Holdings Ltd lost 1.2 percent to A$0.42 after the company announced the pricing of a further $64.6 million of enhanced equipment notes.

New Zealand's benchmark NZX 50 index rose 0.3 percent or 12.1 points to 4,722.7. (Reporting by Thuy Ong; Editing by Chris Gallagher)