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Australia: Shares tumble on Westpac breach, Sino-US trade rhetoric

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The S&P/ASX 200 index was down 1.4 per cent at 6,722.40 at the close of trade.

[SYDNEY] Australian shares ended nearly 1.5 per cent lower on Wednesday, dented by losses in financials, and as US President Donald Trump's reluctance to roll back tariffs on Chinese imports dampened hopes of a trade deal between both the major economies.

The S&P/ASX 200 index was down 1.4 per cent at 6,722.40 at the close of trade. The benchmark ended 0.7 per cent firmer on Tuesday.

Financial stocks, the benchmark's largest component, closed nearly 2.2 per cent lower, with second-biggest lender Westpac Banking Corp weighing heavily after regulators accused the bank of serious breaches of anti-money laundering rules.

Shares of Westpac, the biggest drag in the financial subindex, hit their lowest close since May 17.

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Market voices on:

"Twenty-three million counts of breaches is clearly a significant number ... It is possible we will see substantial fines for Westpac in due course," said Henry Jennings, senior analyst and portfolio manager at Marcustoday Financial Newsletter.

All 'Big Four' banks ended in negative territory with National Australia Bank and Commonwealth Bank of Australia ending about 3 per cent and 1 per cent lower, respectively.

Conflicting signals from Washington and Beijing in the past few days deflated market hopes of a near-term truce to end their damaging tariff war.

Risk appetite took a hit after Mr Trump threatened to escalate the trade spat after saying he would raise tariffs on Chinese imports if no deal was reached.

Across the Tasman sea, New Zealand's benchmark S&P/NZX 50 index rose 0.8 per cent to finish the session at 10,975.49.

Retirement village provider Metlifecare rose 12.8 per cent after the company said it had received a takeover offer and suspended its buyback programme. The stock posted its best session in near 12 years. 

REUTERS