Australia: Technology stocks pull shares lower after hawkish Fed minutes

[BENGALURU] Australian shares dropped on Thursday, as technology stocks tracked overnight losses on the Nasdaq index after minutes from the Federal Reserve's meeting signalled that the US central bank may raise interest rates sooner than expected.

The S&P/ASX 200 index was down 0.8 per cent at 7,504.8 by 2343 GMT, after settling 0.3 per cent lower on Wednesday.

Technology stocks fell as much as 4.3 per cent to hit their lowest since July last year, with buy now, pay later bellwether Afterpay sinking 11 per cent to its lowest since Sept 14, 2020.

Novonix and Altium dropped 3.3 per cent and 4.4 per cent, respectively.

Major indexes on Wall Street ended sharply lower after minutes from the Fed's meeting offered details on its shift last month toward a more hawkish monetary policy.

"With both the inflation and employment goals of the Fed pretty much met, we are very close to the point of rate hikes," analysts at ING Economics said in a note.

"We suspect March is too early for a rate hike, given the lack of visibility caused by Omicron, but May is clearly on the cards," they added.

The heavyweight financial sub-index fell 0.6 per cent, driven lower by losses in the "Big Four" banks.

Gold explorers slid 1.7 per cent, underpinned by weaker bullion prices. Newcrest Mining declined as much as 2.2 per cent to post its biggest intraday loss since Dec. 15, 2021.

Separately, digital payments and lending firm Latitude Group Holdings offered to buy Humm Group's consumer unit, including its buy now, pay later business, for A$335 million (S$328.2 million).

Miners advanced 0.4 per cent, benefiting from strong iron ore prices. Rio Tinto rose as much as 2.8 per cent to its highest since October last year.

Meanwhile, daily Covid-19 cases hit a record for a third day on Wednesday. Officials reported a record 64,774 new cases, exceeding Tuesday's tally of around 47,800.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.8 per cent to 13043.34.

REUTERS