The share market has suffered its largest one day fall in more than three months as investors turned cautious.

Banks and miners were the main drag on the market, though almost all sectors lost ground, with the exception of the energy companies.

The S&P/ASX200 index dropped 1.58 per cent, its heaviest fall since December 9, and the All Ordinaries shed 1.47 per cent, its largest decline since January 6.

EL&C Baillieu stockbroking director Richard Morrow said the local market was due for a pullback as valuations had become stretched.

“We got the right sort of ammunition at the start of the day from the larger than expected fall on Wall Street,” Mr Morrow said.

“That’s really washed through the entire market.”

Wall Street was hit by concerns that technology and biotech equities in particular have become overvalued.

The local financial sector was one of the worst performers, with Commonwealth Bank down $2.02 at $93.84, National Australia Bank lost 65 cents to $38.65, ANZ shed 79 cents to $36.40 and Westpac was 94 cents weaker at $38.95.

The big miners also came under pressure, with BHP falling 33 cents to $30.78 and Rio Tinto shedding 33 cents to $56.50.

But iron ore miner Fortescue Metals gained eight cents to $2.12.

Energy stocks were one of the few bright spots as the oil price gained ground after trouble in Yemen.

Woodside Petroleum added 17 cents to $35.27, Santos lifted 21 cents to $7.55 and Oil Search gained eight cents to $7.68.

Telstra dropped seven cents to $6.30.

KEY FACTS

* At the close on Thursday, the benchmark S&P/ASX200 index was down 94.2 points, or 1.58 per cent, at 5,879.1.

* The broader All Ordinaries index was down 87.4 points, or 1.47 per cent, at 5,849.7.

* The June share price index futures contract was 96 points lower at 5,874, with 27,838 contracts traded.

* National turnover was 1.8 billion securities worth $5.7 billion.