Australia: Shares snap five-day rally as vaccine optimism cools

[BENGALURU] Australian shares closed lower on Thursday for the first time in six sessions, dragged down by heavyweight financial and energy stocks, as the initial optimism about progress in the development of a coronavirus vaccine faded.

The S&P/ASX 200 index closed 0.5 per cent lower at 6418.2.

"Investors are re-assessing the near-term implications of a coronavirus vaccine," Margaret Yang, a strategist from DailyFX wrote in note.

"The road ahead might not be a smooth sailing (one) as challenges remain on the time horizon, manufacturing capacity, delivery and storage of the vaccine."

Financials declined 1.5 per cent, with all the "Big Four" banks closing lower.

The energy index shed about 1 per cent, even as crude prices firmed on hopes that the world's major producers will halt supply increases.

Woodside Petroleum dropped after it shelved talks to sell stakes in a project to Chinese firms on the state of the Sino-Australian diplomatic ties, which had worsened after Canberra called for an inquiry into the source of the coronavirus.

Miners, heavily reliant on exports to China, also fell 1.3 per cent. Sector heavyweights BHP and Rio Tinto , lost 1.1 per cent and 0.7 per cent respectively.

But, tech stocks gained 1.1 per cent, bouncing back from steep losses this week when encouraging vaccine data prompted a rotation away from the sector and lifted demand for battered energy, airlines and travel stocks.

Accounting software maker Xero added as much as 6.7 per cent to hit a record high after reporting a jump in its half year profit. It closed 0.6 per cent higher.

In New Zealand, the benchmark S&P/NZX 50 index ended flat at 12670.62.

Film-related software developer Vista Group, dropping about 4 per cent, was the biggest percentage loser on the benchmark index while exchange operator NZX advanced more than 5 per cent.

REUTERS