The Australian share market has suffered its worst performance in seven weeks, with every sector losing ground as traders brace for a potential second Trump presidency in the United States.
The benchmark S&P/ASX200 index on Tuesday lost 138.7 points to finish at a 13-day low of 8,205.7, a drop of 1.66 per cent, while the broader All Ordinaries dropped 135.1 points, or 1.57 per cent, at 8,469.0.
IG market analyst Tony Sycamore said US Treasury yields had extended their recent gains overnight, putting pressure on equities.
"Higher yields are likely the result of the market moving to factor in an increased chance of a Trump election victory and the higher inflation and fiscal spending it would bring," Mr Sycamore wrote in client note.
This affects Australia's share market because two-thirds of the ASX200 were companies in the financial, real estate and consumer-facing sectors, which had a heightened sensitivity to interest rates and yields, Mr Sycamore said.
Just 30 of the 200 companies in the ASX200 gained ground on Tuesday, with 167 retreating.
Eight of the ASX's 11 sectors lost at least one per cent, with property the biggest loser, dropping 2.3 per cent as Goodman Group dipped 2.7 per cent.
CBA led the big four banks lower, dropping 2.2 per cent to $141.23.
NAB was close behind, falling 2.1 per cent to $38.58, while Westpac fell 1.8 per cent to $31.93 and ANZ dropped 0.8 per cent to $31.25.
In the heavyweight mining sector, BHP fell 1.2 per cent to $42.14, Fortescue retreated 1.6 per cent to $19.53 and Rio Tinto slid 1.4 per cent to $118.15.
Goldminers were mixed even as the precious metal traded at $US2,730 an ounce, just under the record high set on Monday.
Northern Star rose 0.3 per cent and Westgold advanced 0.9 per cent, while Evolution dipped 0.6 per cent and Newmont fell 0.3 per cent.
Elsewhere, Viva Energy slid 6.7 per cent to a two-year low of $2.66 after the Geelong refinery and Shell-branded and On the Run petrol station owner said convenience sales had been softer in recent months, in part because of black market tobacco sales affecting the South Australian market.
Audinate fell 6.1 per cent to a two-month low of $8.96 after the audio networking company said it made just $US7.2 million in first-quarter gross profit.
The company was on track for a similar performance this quarter, meaning its first-half gross profit would be well under the $US21.8 million it made a year ago.
Audinate cited a number of headwinds, including shorter order lead times, increased inventory across the industry, slower clearance of raw material inventories from its manufacturing customers, and softer-than-expected demand from end-users.
The Australian dollar was buying 66.89 US cents, from 67.01 US cents at Monday's ASX close.
ON THE ASX:
* The benchmark S&P/ASX200 index on Tuesday dropped 138.7 points, or 1.66 per cent, to 8,205.7
* The All Ordinaries fell 135.1 points, or 1.57 per cent, at 8,469.
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 66.87 US cents, from 67.01 US cents at Tuesday's ASX close
* 100.82 Japanese yen, from 100.05 yen
* 61.78 euro cents, from 61.69 euro cents
* 51.42 British pence, from 51.37 pence
* 110.42 NZ cents, from 110.35 NZ cents.
