The Australian sharemarket has suffered its heaviest one-day losses since August, with spooked investors reacting to a sharp fall in US manufacturing activity growth.
Stocks on Wall St also had their worst session since June following a strong bull run, providing negative leads for Australian traders amid concerns about the US economy and emerging markets.
The falls on the ASX wiped off more than $28 billion in shareholder value.
CommSec market analyst Steve Daghlian said another factor at play in the losses was the Reserve Bank’s decision to leave Australian interest rates unchanged for a fifth consecutive month on Tuesday.
“The market started to pull back even more following that result, the Aussie dollar picked up significantly … the rate cutting cycle seems pretty much over,” he told AAP.
The market’s heavyweight industries, banking and mining, fell by 1.7 per cent and 2.2 per cent respectively.
BHP Billiton closed 94 cents, or 2.6 per cent, down at $35.50, Rio Tinto shed $1.23 to $64.11 and Fortescue Metals lost 8.0 cents to $5.19.
National Australia Bank suffered the biggest falls of the banks, down 80 cents, or 2.4 per cent, to $32.39, Commonwealth Bank dropped $1.20 to $73.20, Westpac retreated 59 cents to $30.40 and ANZ was 53 cents lower at $29.30.
One of the rare stocks to buck the trend was REA Group, after the owner of property website realestate.com posted 37 per cent profit growth.
REA shares were the best performer among the top 200 stocks, up $2.08, or 5.0 per cent, at $43.78.
KEY FACTS
* At the close on Tuesday, the benchmark S&P/ASX200 index was down 90.8 points, or 1.75 per cent, at 5,097.1.
* The broader All Ordinaries index was down 87.8 points, or 1.69 per cent, at 5,14.1.
* The March share price index futures contract was 95 points lower at 5,050, with 34,839 contracts traded.
* National turnover was 1.84 billion securities worth $5.4 billion.
