News: RIO Australian shares hit near seven-week low as commodity stocks slide

Sept 7 (Reuters) - Australian shares touched a near seven-week low on Wednesday, a day after the country's central bank raised rates, as a slide in commodity stocks and Wall Street weighed on the benchmark index.

The S&P/ASX 200 index (xjo) dropped 1.1% to 6,749.5 by 0045 GMT, extending losses for a second consecutive session, and hitting the lowest since July 21.

The Reserve Bank of Australia raised interest rates for a fifth consecutive time on Tuesday, sending its official cash rate to a seven-year high of 2.35%. It also signalled that more hikes will be required to temper surging inflation.

"We see little reason to change our expectation that the cash rate will be above 3% by the end of the year, especially when we consider the outlook for the labour market," analysts from ANZ Research said in a research note.

Meanwhile, Wall Street was volatile as investors weighed on aggressive rate hikes after a U.S. services industry report reinforced expectations that the Federal Reserve will remain on track to raise rates.

Domestic miners .AXMM led the laggards, falling as much as 2.1%, despite higher iron ore prices. Index heavyweights such as Rio Tinto (RIO) , Fortescue Metals (FMG) and BHP Group (BHP) dropped 0.9%-3.2%.

Energy stocks .AXEJ were also pressured by lower crude prices due to prospects of more rate hikes and weaker COVID-19-led fuel demand in China. Sector majors like Woodside Energy (WDS) and Santos (STO) slid 2% each.

The financial subindex .AXFJ slipped nearly 1%, with the "Big Four" banks falling between 0.2% and 2%, respectively.

Investors' radar is now on the second-quarter GDP data, which will be released later in the day.

In New Zealand, the benchmark S&P/NZX 50 index (nz50) fell 0.4% to 11,552.8 points.