Australian shares declined on Thursday as weakness in mining and banking stocks weighed on the market, with iron ore prices falling to a two-month low amid growing supply concerns and renewed geopolitical tensions in the Middle East dampening investor sentiment.
The S&P/ASX 200 Index fell 99.6 points, or 1.1%, to 8,686.1, with six of the benchmark's 11 sectors trading lower.
The Materials sector led declines as iron ore prices fell to their lowest level in more than six weeks amid concerns over weakening demand in China, with shrinking steel mill margins and softer steel consumption adding pressure amid elevated input costs.
BHP fell 3.3%, Rio Tinto also declined 3.3%, while Fortescue dropped 4.1%.
Investor caution was further amplified by renewed clashes between the United States and Iran, which raised concerns about the durability of the fragile ceasefire in the Middle East and contributed to a broader risk-off tone across markets.
The telecommunications sector also traded lower, with Telstra falling 2.9%, Seek declining 1.2%, and TPG Telecom losing 2.2%.
Technology stocks were among the weaker performers. WiseTech Global fell 4.2%, Xero lost 2.9%, and TechnologyOne slipped 1.9%.
Major banks also retreated, adding further pressure to the benchmark index. Commonwealth Bank fell 0.6%, National Australia Bank lost 0.6%, Westpac declined 1.7%, and ANZ dropped 0.5%.
In corporate news, Treasury Wine Estates surged 13.1% after outlining a strategic overhaul during its investor day presentation.
The wine producer told shareholders it would sharpen its focus on 10 core brands, increase investment in lighter-style wines as well as zero and low-alcohol products, and review its underperforming U.S. operations in an effort to improve profitability and drive long-term growth.
On the bond markets, Australian government bond yields edged lower. The 10-year yield fell 0.5% to 4.92%, while the two-year yield declined 0.7% to 4.605%.
