Australian shares hit a more than two-month low on Friday, as investors returning to trading after a one-day holiday exited riskier assets, following the US Federal Reserve reiterating its hawkish monetary policy outlook to fight searing inflation.

The S&P/ASX 200 index slumped as much as 1.4% to 6,602.6 by 0040 GMT, to hit its lowest level since July, with all but one subindex trading in the red.

Australian markets were closed on Thursday for a public holiday.

Shares tumbled globally on Thursday, after the Fed raised its key policy rate by another 75 basis points for the third consecutive time on Wednesday and warned of further increases, fuelling concerns of a recession.

In Sydney trading, financials led the laggards, shedding about 1.8% and losing for the sixth straight week, with the country’s largest banks falling between 1% and 1.3%.

The technology index lost about 3.6% to hit their lowest since mid-July, tracking their peers on the Nasdaq Composite Index, with accounting service provider Xero Ltd as ASX-listed shares of Block Inc dropping 4.3% and 8.9%, respectively.

Commodity stocks drag Australian shares to 2-month low ahead of Fed decision

Healthcare stocks suffered a similar fate, skidding 1.1%, with index major CSL Ltd falling 0.4%.

Miners provided some respite to an otherwise negative benchmark, rising nearly 1%, as iron ore prices rebounded in China upon higher demand for the steel making ingredient.

The major mining trio Rio Tinto, BHP Group and Fortescue Metals rose in the range of 0.4% and 2.8%.

OZ Minerals’ shares rose 1.1%, after the miner said it would would invest about $1.13 billion to develop the West Musgrave copper-nickel project in Western Australia, as it looks to cash in on increasing demand for battery metals.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.6% to 11,442.1.