By Suhail Hassan Bhat
Jan 18 (Reuters) - Australian shares fell to a three-week low on Wednesday, as financials and pharma stocks followed their U.S. peers after Wall Street was hit by President-elect Donald Trump's remarks on the U.S. dollar and drug pricing.
The S&P/ASX 200 index .AXJO was 0.6 percent, or 36.32 points, lower at 5,663.1 by 0030 GMT. The benchmark has risen in line with U.S. indexes such as S&P 500 .SPX and Dow Jones Industrial Average .DJI since Trump's victory in November. (http://tmsnrt.rs/2jI6bru)
"We had fairly negative lead from oversees markets and that combined with lower commodity prices has generated selling pressure in Aussie markets", said Michael McCarthy, chief market strategist with CMC Markets
Trump said in an interview with the Wall Street Journal that the strength of the dollar was hurting competitiveness of U.S. companies. President-elect's remarks pushed the greenback to four-week low and sent bond yields down as investors moved away from riskier assets.
ASX financials index .AXFJ , which had gained more than 15 percent since the U.S. election, attracted some selling for the second straight session, ahead of Trump's inauguration on Friday.
Financials underperformed other sectors, with "Big Four" banks driving the losses.
Westpac WBC.AX and ANZ ANZ.AX shares flirted with one-month lows.
Healthcare stocks also declined. Trump told the Washington Post that he would target companies over drug pricing and would replace Obamacare with a plan that would envisage "insurance for everybody". ResMed Inc RMD.AX dropped 3.6 percent to a one-month low, while Mayne Pharma MYX.AX and CSL Ltd CSL.AX declined 3 percent and 1 percent, respectively.
Iron miners including heavyweights BHP Billiton (LON:BLT) BHP.AX and Fortescue Metals Groups FMG.AX also lost ground, as Dalian iron ore pulled back from 3-year highs and copper eased on Tuesday. IRONORE/
At the other end of the spectrum, gold and energy stocks rose as a weaker U.S. dollar helped gold and oil prices. GOL/ O/R
SX gold index .AXGD gained 1.6 percent to a 2-month high, with Newcrest Mining NCM.AX rising 1.2 percent, while Woodside Petroleum WPL.AX hit over one-year highs in morning trade.
New Zealand's benchmark S&P/NZX 50 index .NZ50 fell 0.3 percent or 21.98 points to 7,040.98.
Materials and consumer discretionary stocks led the losses, with Fletcher Building FBU.NZ falling 1.7 percent and web advertiser Trade Me Group TME.NZ dropping 2 percent to a near 1-month low.