Fortescue Ltd (FSUMF)

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Australian shares fell, giving up initial gains, as the prospects of slowing growth in the world's two largest economies dragged down mining and energy shares. However, the downside was limited as a weaker Australian dollar, weighed down by lower commodities and disappointing U.S. economic data, boosted the outlook for company earnings. The benchmark S&P/ASX 200 slipped 0.1 percent, while the broader All Ordinaries index shed 0.2 percent.

Index heavyweight BHP Billiton lost a percent and smaller rival Fortescue tumbled 2.2 percent. Rio Tinto edged down 0.3 percent after saying that it had entered into exclusive talks with US-based private-investment firm HIG Capital to sell its specialty alumina business in Europe.

Energy shares followed their U.S. peers as news of a surge in U.S. Crude inventories and reports that the U.S., the U.K., Japan and France are preparing for a potential release of their strategic oil reserves in the next few months weighed on Crude prices overnight. Woodside Petroleum shed 1.3 percent and Oil Search tumbled 2.1 percent.

Leighton Holdings slumped 6.7 percent to a 10-week low after the construction firm cut its 2012 profit forecast by as much as 38 percent, citing problems associated with its Airport Link and Victoria desalination projects. The big four banks ended mixed, with Westpac losing 0.3 percent and ANZ closing unchanged, while Commonwealth and NAB rose modestly