Australian shares fell on Monday by their most in nearly nine weeks, dragged down by losses in miners and banks, as bets of more aggressive rate hikes in the United States soured risk appetite globally.

The S&P/ASX 200 index settled 2% lower at 6,965.5, snapping three straight sessions of gains, after Federal Reserve Chair Jerome Powell’s promise of policy “pain” to contain inflation quashed hopes that the central bank would ride to the rescue of markets as so often in the past.

“Powell’s address… was short and as far as equity market investors were concerned, bitter not sweet,” said Ray Attrill, head of FX strategy at National Australia Bank (NAB).

Among individual stocks in Australia, Fortescue Metals Group dropped 4.9% in its worst day in more than six weeks after posting a slump in annual profit.

The world’s fourth-largest iron ore miner posted a 40% drop in profit and slashed its dividend on declining iron ore prices amid cooling demand from top consumer China. Its margins were further squeezed by rising costs and labour shortages in the aftermath of the COVID-19 pandemic.

Australia shares climb as miners shine, focus on Fed chair’s speech

The mining index closed down 2.4%, also weighed down by weaker iron ore, copper and gold prices. Rio Tinto and BHP Group fell 2.4% and 1.5%, respectively. Gold stocks fell 4.2% to close at their lowest in about six weeks.

Financials fell 2.2% in their worst session sincemid-June, with the so-called “Big Four” banks declining between 1.9% and 2.5%.

Technology stocks, which typically track the Nasdaq Composite Index, tumbled 4.4%.

New Zealand’s benchmark S&P/NZX 50 index fell 0.9% to 11,506.94.

Among outperformers, a2 Milk Co surged 9.7% to its highest close since March 1 after the dairy producer posted a better-than-expected annual profit and forecast a positive 2023, benefiting from a recovery in demand for its China and English label products.