Australian shares drop as US strikes on Iran, Hormuz closure spook investors

Australian shares fell on Thursday for a fourth session in five, as fresh US strikes on Iran and Tehran’s closure of the Strait of Hormuz fanned investor concerns about inflation and growth.

The S&P/ASX 200 index fell 0.8% to 8,583 by 0027 GMT, with most sectors trading lower.

The benchmark ended 0.6% higher on Wednesday, snapping three straight sessions of losses.

Overnight, Tehran announced the closure of the Strait of Hormuz and warned that any vessel attempting to pass through will be shot at, after the US launched a fresh round of strikes against multiple targets in Iran.

Oil prices gained more than $2 a barrel, while gold prices hit a more than six-month low on fears that central banks would keep interest rates higher for longer to rein in inflation.

In Sydney, gold stocks dropped as much as 5.1% to hit a nine-month low.

Evolution Mining and Newmont fell more than 4% each.

Shares of Northern Star Resources dropped over 5% to hit their lowest in more than two months.

Activist investor Elliott Investment Management said the gold miner must act immediately to restore shareholder value by strengthening its board and undertaking a formal strategic review.

Miners fell as much as 2.8% to hit the lowest level in a month, weighed down by weak commodity prices.

Sector majors BHP Group, Rio Tinto and Fortescue declined between 1.1% and 2.1%.

Financials lost 1%, with the “Big Four” banks shedding more than 1% each.

Technology stocks declined 1.9%, tracking weakness in their US peers.

Among gainers, energy stocks advanced 2.1% in their steepest intraday rise in three weeks.

Oil and gas firms Woodside Energy and Santos rose more than 2% each. In New Zealand, the benchmark S&P/NZX 50 index fell 0.7% to 13,164.94.