News: WBC Australia shares tumble on Westpac breach, Sino-U.S. trade rhetoric; NZ up

• Westpac weighs after alleged misconduct
• Gold miner Saracen top loser in benchmark index
• Metlifecare lifts NZ index

(Updates to close)

Australian shares ended nearly 1.5% lower on Wednesday, dented by losses in financials, and as U.S. President Donald Trump's reluctance to roll back tariffs on Chinese imports assuaged hopes of a trade deal between both the major economies.

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

Financial stocks (xjo) , the benchmark's largest component, closed nearly 2.2% lower, with second-biggest lender Westpac Banking Corp (WBC) 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.

"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 (NAB) and Commonwealth Bank of Australia (CBA) ending about 3% and 1% 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 Trump threatened to escalate the trade spat after saying he would raise tariffs on Chinese imports if no deal was reached.

The energy subindex .AXEJ closed 1.6% lower, with Woodside Petroleum (WPL) dropping 1.3% in its worst session in almost a month, while Santos (STO) shed 1.5% to hit a nearly two-week low.

Healthcare stocks .AXHH dropped 1.3%, dragged lower by a 1.5% fall in sector heavyweight CSL Ltd (CSL) and a 2.4% dive in hearing implants maker Cochlear (COH) .

The broader mining index .AXMM ended trade about 1% lower, with gold miner Saracen Mineral Holdings (SAR) as the top loser. The Perth-based company's stock dropped about 8.6% to close at its lowest since May 13 following a discounted placement earlier in the day.

Across the Tasman sea, New Zealand's benchmark S&P/NZX 50 index (nz50) rose 0.8% to finish the session at 10,975.49.

Retirement village provider Metlifecare (MET) rose 12.8% 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.

($1 = 1.4676 Australian dollars)