Australia shares fall on broad-based sell-off

* Shares (Berlin: DI6.BE - news) down 1.4 pct

* All sectors in red, energy stocks rise on higher oil

* 184 shares down, 13 up, 3 unchanged (Adds analysis, quotes, stocks on the move)

By Swati Pandey and Gyles Beckford

SYDNEY/WELLINGTON, (Reuters) - Australian shares fell 1.4 percent on Thursday, with the financial and materials sectors leading a broad-based decline, although energy shares rose after oil gained overnight.

The S&P/ASX 200 index fell 88.02 points to 5,895.3 points by 0035 GMT. The index closed near unchanged on Wednesday as the benchmark continued to flirt with the 6,000 mark, which has proved to be a formidable barrier so far.

Two attempts to break above that level this month ended in failure as profit-takers were quick to emerge.

"I think we are seeing nervousness around valuations and growth," said Julia Lee, equities analyst at Bell Direct. "Also, there are concerns of cyclical weakness in some sectors. Small caps are declining more than the blue chips."

The index is up nearly 9 percent so far this year but is set for its worst monthly performance since last November.

The big banks including CBA and ANZ were down more than 1 percent. Major miner BHP Billiton (NYSE: BBL - news) dropped 1.1 percent while Rio Tinto (Xetra: 855018 - news) rose marginally.

Myer, trading ex-dividend, was among the biggest losers on the index. It is facing legal action by some of its shareholders on a shock profit downgrade. ]

Vocation jumped about 9 percent after it said it has cut bank debt to less than A$10 million.

U.S. stocks dropped on Wednesday as a slump in technology and biotechs sent the Nasdaq to its biggest decline in nearly a year.

New Zealand's benchmark NZX50 index was markedly softer, falling 0.7 percent to 5,815.65, a one-month low.

The falls outnumbered the gains two to one, led by drops for all of the top-10 stocks, which dominate the index.

The number one company Fletcher Building (NZSE: FBU.NZ - news) was 1.6 percent lower at NZ$8.53, and number two stock, telecommunications company Spark was down 1.7 percent to NZ$2.92, a three-month low.

The Fonterra shareholders fund managed a slight rise to NZ$5.57 as it looked to have found a bottom after hitting a 27-month low after the previous day's report of a lower first-half profit and forecast lower dividend.

The market, which hit a lifetime high last week, has been consolidating with profit taking on selective stocks, while the looming end of the fiscal year on March 31 is often a dampener as investors shuffle investments to meet tax liabilities. (Editing by Richard Pullin)