The share market recovered some of its early falls but still closed in negative territory as sentiment remained subdued on strengthened expectations of a rate hike by the US Federal Reserve.
The benchmark S&P/ASX200 index dropped 0.6 per cent, with materials, industrials and real estate stocks among the worst performers.
Gold miners in particular fell sharply after the price of the precious metal slumped more than three per cent overnight.
The losses came as investors fleed the safe-haven asset and the US dollar strengthened after comments by several Federal Reserve officials stoked expectations the Fed will lift its key interest rate by the end of 2016.
Investors were also spooked by a report that the European Central Bank will taper its bond buying program.
“The commodity-based stocks have been the problem all day, after the comments from the Fed officials. Some of it also has to do with the speculation about ECB’s moves,” optionXpress market analyst Ben LeBrun said.
“It will be data heavy for the next few days and most of the attention will be on the US non-farm payrolls data for September, due on Friday.”
Among the gold miners, Newcrest dropped $1.15, or 5.1 per cent, to $21.28, Evolution Mining lost 20 cents, or 7.9 per cent, to $2.33 and Regis Resources fell 25 cents, or 6.6 per cent, to $3.56.
With copper and iron ore prices also falling, Rio Tinto shares shed 58 cents to $51.90 and BHP Billiton slipped five cents to $22.85.
The four major banks, facing the scrutiny of a public hearing into the sector by a House of Representatives’ Standing Committee on Economics, were mixed.
ANZ dropped five cents to $28.05, NAB slipped seven cents to $28.06, while Westpac gained 20 cents to $30.20 and Commonwealth Bank was 29 cents higher at$73.59.
Other gainers included energy producers like Santos, which added six cents to $3.86, and Oil Search gained 10 cents to $7.30.
KEY FACTS:
* At 1615 AEDT, the benchmark S&P/ASX 200 index was down 31.1 points, or 0.57 per cent, at 5,452.9 points.
* The broader All Ordinaries index was down 32.9 points, or 0.59 per cent, at 5,537 points.
* The December share price index futures contract was down 39 points at 5,434 points, with 27,057 contracts traded.
* National turnover was 2.86 billion securities traded, worth $5.5 billion.
