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By Archishma Iyer

Oct 2 (Reuters) -Australian shares closed slightly lower on Wednesday, as losses in consumer-focussed and technology sectors outweighed gains in energy and mining stocks, while Iran's ballistic missile strike on Israel stoked fears of a wider conflict in the Middle East.

The S&P/ASX 200 index .AXJO ended 0.1% lower at 8,198.2. The benchmark fell 0.7% on Tuesday.

Risk appetite declined as investors fretted about the widening of conflict in the Middle East, pressuring stock markets globally.

In Sydney, consumer discretionary stocks .AXDJ and staples .AXSJ fell 1.7% and 0.8%, respectively, weighing the most on the benchmark, after retail sales data from Tuesday signalled that the country's central bank may not cut rates soon.

Technology stocks .AXIJ slipped about 1.6% after the Nasdaq Composite Index .IXIC closed lower overnight.

Accounting software provider Xero XRO.AX and WiseTech Global WTC.AX lost 2.5% and 1.7%, respectively.

Heavyweight financials .AXFJ closed flat, with three of the "Big Four" banks shedding between 0.1% and 0.4%.

Energy stocks .AXEJ, however, advanced 2.4%, hitting a one-month high, as Brent crude prices rose due to potential supply disruption from the Middle East conflict. O/R

Woodside Energy WDS.AX and Santos STO.AX rose 3.1% and 2.4%, respectively.

Miners .AXMM rose 0.7%, with index majors Rio Tinto RIO.AX, BHP Group BHP.AX and Fortescue FMG.AX gaining between 0.2% and 0.9%.

The sector has risen for a sixth session in seven as stimulus measures announced by top steel producer China last week have led investors to reallocate funds to the resources index.

"We are still seeing that rotation out of banks into resources after the China stimulus announcement," said Mark Gardner, head of equities advisory at MPC Markets.

"The miners were heavily oversold and are now probably back around fair value."

In other news, Australia's top court dismissed ANZ Group's ANZ.AX appeal against a lawsuit that found it guilty of not revealing about a share placement worth A$2.5 billion ($1.72 billion).

New Zealand's benchmark S&P/NZX 50 index .NZ50 fell 0.1% to finish at 12,451.69.

($1 = 1.4537 Australian dollars)

Reporting by Archishma Iyer in Bengaluru; Editing by Subhranshu Sahu

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