The benchmark S&P/ASX 200 index closed 68.1 points lower, a fall of 1.43% to 4699.7, while the broader All Ordinaries closed 71.9 points down on 4791.3.

The first drop in employment in 18 months followed an unexpected 10,100 fall in the number of people employed in February, which actually masked a jump in full-time positions.

While Australian Bureau of Statistics data showed a 57,700 drop in part-time employment, full-time positions rose by 47,600, with the jobless rate remaining at a seasonally adjusted 5%.

On Wall Street, the Dow Jones Industrial Average closed 1.29 points or 0.01% lower on 12,213.09, while the S&P 500 shed 1.8 points or 0.14% to 1320.02.

Asian and European stocks also fell overnight, while US treasuries rose after an auction of $US21 billion in 10-year notes drew higher-than-forecast demand amid escalating violence in Libya.

Oil retreated by 0.6% to $104.38 a barrel following government data showing supplies at a major US hub have surged, erasing an earlier gain as Muammar Gaddafi stepped up attacks.

China, Australia’s largest trading partner, reported an unexpected $7.3 billion trade deficit, the nation’s biggest in seven years, in February after a Lunar New Year holiday disrupted exports, compared to a $6.5 billion surplus in January.

Outbound shipments rose an annual 2.4%, the slowest pace since November 2009, while imports climbed 19.4%, Bloomberg quoted from a customs bureau website today.

“Cutting the nation’s surplus would bolster the Chinese government’s argument that it is gradually rebalancing the economy,”Bloomberg quoted Singapore-based Action Economics economist David Cohen as saying.



Of the big miners, BHP Billiton lost $A1.42 to close on $44.58, while Rio Tinto shed $2.03 to $80.35, Fortescue Metals Group was 33c lower on $6.06, OZ Minerals dropped 8c to $1.495 and Paladin Energy closed 16c lower on $4.84.

Elemental Minerals had one of the biggest share price runs of the day, gaining 19.43% or 34c to $2.09 on no news, while energy company United Orogen had the biggest fall of the day, losing 13c to close on 27c.

Spot gold was also down, fetching $US1430.20 an ounce at 4.15pm AEDT.

Australia’s largest locally owned gold producer, Newcrest Mining, closed the day A59c lower on $37.71, while Kingsgate shed 42c to $8.24 and AngloGold Ashanti lost 41c to $9.29.

As for commodities traded on the London Metal Exchange, all were lower with copper for three-month delivery falling $US255 to $9275/t, lead dropping $110 to $2480/t, zinc shedding $122 to $2273/t, nickel down $675 to $26,150/t, tin tumbling $1075 to $29,525/t and aluminium closing $17 down on $2579/t.

The Australian dollar was trading slightly higher, but remained on parity with the greenback, fetching $US1 at 4.21pm.