Australian shares reached their lowest in more than six weeks on Wednesday as the U.S. dollar strengthened ahead of U.S. jobs data this week, hurting basic materials and energy stocks.
The S&P/ASX 200 index (xjo) fell 53.39 points, or 0.97 percent, to 5424.9 by 0239 GMT, its lowest since mid-July. The benchmark had closed marginally higher on Tuesday.
The dollar rose to a three-week high against a basket of currencies as investors looked ahead to U.S. payroll data this week, seeking clues to when the Federal Reserve may next raise interest rates after U.S. Fed Vice Chair Stanley Fischer said that jobs data could influence any rate decision. [.DXY]
"Traders are quite concerned that if we see strong (job) numbers on Friday, it could push up the U.S. dollar further and drag down commodity prices," said Angus Nicholson, an analyst with IG Markets.
"I think people are trying to hedge a bit and position themselves against that potential outcome."
Basic materials led the losses, with mining majors BHP Billiton Ltd (BHP) and Rio Tinto Ltd (RIO) falling about 3.2 percent each. Fortescue Metals (FMG) shed over 3 percent.
Newcrest Mining (NCM) and Northern Star Resources (NST) shed 4.4 percent and 3.5 percent respectively as gold hit a two-month low. [GOL/]
Oil stocks fell on weaker crude oil futures, with oil producers Woodside Petroleum (WPL), Santos Ltd (STO), and Oil Search Ltd (OSH) down 0.9 percent to 2.9 percent.
Financials, the biggest constituent on the index, wiped out the previous session's gains, with Commonwealth Bank of Australia (CBA) losing 1.6 percent and Westpac Banking (WBC) 1.3 percent down.
New Zealand's benchmark S&P/NZX 50 index (nz50) was flat at 7388.81 points.
Minor gains in consumer staples and utilities were offset by financials falling over 1 percent. Basic materials were also among the biggest losers.
Westpac Banking Corp (WBC), among top losers, lost 1.8 percent, while Fonterra Shareholders' Fund (FSF) was 1 percent lower.
