Australian shares ended in red on Thursday, dented by rate-sensitive technology stocks and banks as investors worry about the central bank adopting a tighter monetary policy, while Ardent Leisure jumped on a deal to offload its US division.
The S&P/ASX 200 index closed 0.63% lower at 7442.8 points, extending losses for the second straight session. Asian shares also retreated, in line with a global selloff, as markets were spooked by more aggressive noises from US policymakers about the need for tighter policy.
The Reserve Bank of Australia (RBA) had opened doors to the first interest rate hike in more than a decade, while the recent minutes of the US Federal reserve meeting hinted a more aggressive stance on rate hikes.
"The RBA has also been raising its own expectations for the federal funds rate in the wake of recent data releases and the strong rhetoric from FOMC (Federal Open Market Committee) members, including Chair Powell," Westpac analysts said in a note.
Australian technology stocks slid 3.4%, leading losses on the benchmark, with ASX-listed shares of Block Inc falling up to 4.7%. Wisetech Global and Novonix fell nearly 6% each and were among the top losers in the technology sub-index.
Financials lost up to 1.1% with the "Big Four" falling nearly 1% each. "The global trend that's been driven by the FOMC is obviously still prevalent in the Australian markets," Jessica Ren, Rates Market Strategist at Westpac said.
Energy sub-index also slipped 1.3%, tracking the overnight plunge in oil prices after member states of the International Energy Agency agreed to release 120 million barrels from strategic reserves to try to quell price gains. Sector heavyweights Woodside Petroleum fell 2.5% while Santos slid 1.4%.
Australian shares end lower as global rate hike bets firm
Shares of Ardent Leisure, however, jumped 6.2% after the company said it will sell its US entertainment business to restaurant chain operator Dave & Buster's Entertainment for $835 million.
In New Zealand, the benchmark S&P/NZX 50 index closed flat at 12075.91 points.