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Australia: Shares drop as vaccine trials halt, stimulus hopes fade

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[SYDNEY] Australian shares closed lower on Wednesday, with heavy selling in financial and energy stocks, as halted Covid-19 vaccine trials and an elusive US coronavirus relief package dented risk appetite.

The S&P/ASX 200 index slipped 0.3 per cent to 6,179.20 at the close of trade. The benchmark closed 1 per cent higher on Tuesday.

Global markets took cue as major indexes on Wall Street closed the previous session in the red, after Covid-19 vaccine trials were paused by Johnson & Johnson due to an unexplained illness in a study participant.

Diminishing hopes for the passage of a US coronavirus relief bill also added to the gloom after House Speaker Nancy Pelosi rejected the US$1.8 trillion proposal from the White House.

"It's (U.S. stimulus) become a fairly politically charged event, and I'm not sure that the Democrats are going to give Mr Trump a free kick and pass anything stimulus wise for the next 20 days," said Damian Rooney, director of equity sales at Argonaut.

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The heavyweight financial sector stocks finished about 1 per cent lower, with the so-called "Big Four" banks closing in the red.

"Few brokers are starting to look at the banking sector after its big run, so I think there's a few profit takers there," Henry Jennings, a senior analyst and portfolio manager at Marcustoday said.

In New Zealand, the benchmark S&P/NZX 50 index rose 0.72 per cent to yet another closing high of 12,543.61.

REUTERS

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