The Australian sharemarket tumbled on Monday as surging oil prices and escalating conflict in the Middle East triggered a broad global sell-off.
The S&P/ASX 200 Index fell 252.0 points or 2.9% to 8,599.0, with 10 of the 11 sectors finishing the session in negative territory.
Markets were rattled after crude oil prices surged close to US$120 a barrel, rising nearly 30% as major Middle Eastern producers scaled back output amid ongoing disruption to the critical Strait of Hormuz shipping route.
Adding to market uncertainty was confirmation that Mojtaba Khamenei, the son of Iran’s late supreme leader Ayatollah Ali Khamenei, would succeed his father following his death in a strike by U.S. and Israeli forces.
The Materials sector was heavily sold off, falling 5.1% as weakness in commodity prices and risk sentiment weighed on mining stocks.
Major miners all ended the session lower, with BHP down 5.1%, Rio Tinto falling 3.8%, and Fortescue dip[ping 1%.
Gold miners also retreated as rising interest rate expectations pushed the precious metal lower.
Northern Star Resources dropped 6.2% while Newmont fell 3.3% and Evolution Mining lost 5.9%.
Technology stocks were also under pressure, with WiseTech Global down 3.9%, Xero falling 4.8%, TechnologyOne down 3.7%, and NextDC finishing 6.4% lower.
The financial sector declined as well, as Commonwealth Bank lost 1.8%, National Australia Bank fell 1.6%, Westpac declined 2.2%, and ANZ dipped 2.3%.
Despite the broader market decline, energy companies finished higher amid the surge in crude prices.
Woodside Energy rose 2%, Santos gained 2.4%, Karoon Energy jumped 10.2%, and Beach Energy advanced 1.3%.
Santos and Beach Energy also announced they would proceed with the Moomba Central Optimisation project in South Australia’s Cooper Basin.
Coal producers rallied strongly as traders sought alternative energy sources amid disruption to gas supplies in the Middle East.
Yancoal surged 13.3%, while New Hope Corporation climbed 2.8% and Whitehaven Coal rose 4.4%.
In corporate news, Dyno Nobel dropped 9.7% after announcing the sale of its Phosphate Hill fertiliser business to Mayfair Australia for a nominal $1 as the company completes its exit from the fertiliser sector to focus on explosives.
DigiCo Infrastructure REIT also declined heavily, falling 7.4% after chief executive Michael Juniper said he would take an extended period of personal leave. The company said Chris Maher would step in as interim chief executive during his absence.
Elsewhere, Amplitude Energy rose 3.1% after reporting promising preliminary results from its Isabella sidetrack well in the Offshore Otway Basin in Victoria, part of the VIC/L24 permit area.
On the bond markets, the 10-year bond yield rose 1.1% to 4.942%, while the two-year yield increased 0.4% to 4.47%.
