Rio Tinto shares drop on China spying claims

MELBOURNE (Reuters) - Shares in global miner Rio Tinto Ltd fell 2 percent on Monday after China stepped up its espionage allegations, saying the company had spied on steel mills for six years which led to them overpaying $102 billion for iron ore.

The company declined to comment on the latest allegations, which appeared on Saturday on a Web site of China's state secrets administration.

Last month, China detained four Rio Tinto employees in Shanghai, alleging they had stolen state secrets. The men, including Australian Stern Hu, remain in detention and have yet to be charged.

The company said last month that its employees had done nothing wrong.

Analysts said it was hard to assess what the latest allegations might mean for Rio Tinto's business or other iron ore miners, like BHP Billiton and Brazil's Vale.

"It's a concern, but we still await real details before we can judge what's really gone on," said Tim Schroeders, portfolio manager of Pengana Capital's global resources fund.

Rio shares were last down 1.7 percent at A$59.60 after touching a low of A$59.32, in a broader market that was trading 0.7 percent higher.

"There's a little bit of nervousness about the allegations," said Schroeders.

(Reporting by Sonali Paul; Editing by James Thornhill)