Australian shares recorded their worst session in over a month on Tuesday, dragged by heavyweight miners as COVID-19 infections surged in China, worsening fears of an economic slowdown in the top metals consumer in the world.
The S&P/ASX 200 closed 1.5% lower at 7,024.30 points, extending losses for a fourth straight session.
The benchmark posted its worst day since Nov. 3 and marked its lowest level since Nov. 11.
Beijing reported five COVID-related deaths on Tuesday, following two on Monday which were the first fatalities reported in weeks.
That weighed on miners, which slumped 1.9% to hit a three-week low. Heavyweights BHP Group, Rio Tinto and Fortescue Metals dropped between 1.2% and 1.6%.
Separately, minutes of the Reserve Bank of Australia December policy meeting on Tuesday showed that it weighed three options at its last meet this year - hiking by 50 basis points (bps), 25 bps or pausing, but the arguments for a 25 bps hike prevailed.
“Despite the fact that the board considered the ‘pause’ option, these minutes do not paint a dovish picture,” Bill Evans, chief economist at Westpac said in a note.
“The key is that the current forecasts which have rates rising further are still pointing to a number of years where the inflation rate is outside the range.”
Financials dropped 0.2% in their fourth consecutive session of losses.
Technology stocks tracked their Wall Street peers lower as they slipped 4.4% to post the worst day in nearly two months.
Australian shares inch lower over global recession fears
Software maker Xero and WiseTech Global tumbled 6.3% and 6%, respectively. Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 ended 1% lower at 11,404.83, marking its worst session since early November.
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