Australian shares fell more than 2% on Thursday to touch their lowest level in five weeks, as mining stocks declined, while major banks tracked a sell-off on Wall Street overnight.

The S&P/ASX 200 index fell 2.1% to 6,8430 points by 0030 GMT, the lowest since July 28. The benchmark had settled 0.2% lower on Wednesday.

World stocks ended lower overnight, cementing worries about aggressive interest rate hikes from the Federal Reserve and stoking fears of a global economic slowdown.

Export-reliant miners were the top losers on the Australian benchmark index, shedding 3.7%.

Iron ore futures skidded overnight after a survey raised doubts about a rebound in China, world’s top steel producer and consumer.

Sector behemoths BHP, Rio Tinto and Fortescue Metals shed between 1.2% and 7.9%.

BHP Group, with its 7.9% fall, was the biggest laggard on the local bourse, and marked its worst day in over six months as the company traded ex-dividend.

Financials fell 1.8%, with all “Big Four” banks sliding more than 1% each.

The Australian Prudential Regulation Authority (APRA) said the country’s third-largest lender, Westpac Banking, no longer needs to keep an additional amount of cash reserve after the bank took steps to rectify issues related to the regulator’s liquidity requirements.

Australia shares close lower as mining, energy stocks weigh

Westpac shares dropped 1.2% in tandem with broader market moves.

Energy stocks skidded 2% after oil prices slipped overnight on worries of a hit to the global economy from renewed COVID-19 restrictions in China.

Sector leaders Woodside Energy and Santos dropped 1.8% and 2.3%, respectively, with Woodside hitting lowest in over a week.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index fell 0.29% to 11,567.8 points.