By Swati Pandey and Rebecca Howard
SYDNEY/WELLINGTON, Jan 5(Reuters) - Australian shares slipped again on Tuesday, their third consecutive drop, on worries about the global fallout of slowing growth in China, with banks leading declines.
Sentiment was weak after U.S. stocks began 2016 sharply lower, with the Dow marking its worst start to a year since 2008, after weak Chinese economic data fanned fears of a global slowdown.
By 0139 GMT, the S&P/ASX 200 index .AXJO skidded 0.9 percent, or 51.48 points to a one-week low of 5,219.0. It fell 0.5 percent on Monday.
New Zealand's benchmark index S&P/NZX50 .NZ50 fell as much as 1.4 percent on the first trading day of the year after a four-day holiday weekend.
"The New Year has not been kind to local traders," said Chris Conway, Head of Research at Australian Stock Report.
"If we're being totally fair, the market is simply giving back some of the contrived Santa Claus gains we saw towards the end of last year."
The Australian market jumped 2.5 percent to a two-month high in December following a nine-day rally. However, it ended the year more than 2 percent down as slumping iron ore and metal prices hit blue chip mining stocks, while stringent capital rules hurt the heavyweight banking sector.
The New Zealand exchange soared 13.5 percent in 2015.
All sectors traded in the red on Tuesday with financials weighing the most on the index. The "Big Four" banks - CBA CBA.AX , National Australia Bank NAB.AX , ANZ ANZ.AX and Westpac WBC.AX - were down 0.8-1.5 percent. Top investment bank Macquarie MQG.AX fell more than 1 percent.
Healthcare stocks such as Sirtex Medical SRX.AX fell more than 4 percent after Morningstar cut its rating on the stock to reduce from hold. Other healthcare stocks such as Mayne Pharma MYX.AX and Japara JHC.AX were also trading weak.
Gold miners such as Newcrest Mining NCM.AX , Oceanagold OGC.AX and Evolution Mining EVN.AX gained 2.5-6.7 percent.
China stocks opened lower on Tuesday, the day after a 7 percent plunge in mainlaind shares roiled global market and prompted regulators to suspend domestic trade.
By 0139 GMT, the New Zealand benchmark traded 0.7 percent lower at 6,277.16.
The biggest gainers were small-cap Wynyard Group, up 4.9 percent after it said it signed an agreement to provide an unnamed national security bureau with software and services.
Steel & Tube STU.NZ was up 2.2 percent in early trading. In the other direction, Xero XRO.NZ was down 6.3 percent. Trade remained very thin with many market players still on holiday.