[SYDNEY] Australian shares fell on Wednesday as investors booked profits in bank stocks, but a surge in Fortescue Metals Group helped underpin the mining sector.

The S&P/ASX 200 index eased 0.4 per cent, or 23.9 points, to 5,674, pulling back from a two-month peak of 5,727.7 set a day earlier.

Weighing heavily on the index, the big four banks all closed lower with Westpac Banking Corp shedding 0.8 per cent.

Fortescue Metals ended 6.2 per cent higher, having earlier jumped as much as 10 per cent on a media report about a possible asset sale deal. The company later said there was no agreement of such a nature at this time, but was open to"commercial discussions".

New Zealand's benchmark NZX 50 index inched up 0.08 per cent, or 4.8 points, to end at 5,938.5.

REUTERS