News: XIJ Australia shares end at 5-week low as miners, gold stocks weigh

• Commodity sectors lead declines
• Rio Tinto agrees to buy rest of Canada's Turquoise Hill
• Gold stocks hit lowest since Oct 2018

(Updates to close)

Australian shares closed at a five-week low on Thursday, as miners and gold stocks slid on weaker commodity prices, while the benchmark index also tracked overnight slide on Wall Street.

The S&P/ASX 200 index (xjo) ended 2% lower at 6,845.6 points, the lowest level since July 28.

Global equities were on the back foot as some U.S. Federal Reserve officials overnight reiterated that more aggressive rate hikes were needed to stem soaring inflation, increasing fears of an economic meltdown.

"The commencement of a new month only reminds the market participants that we are potentially heading into a period of increased volatility and uncertainty in light of a new round of rate hikes and the resurgence of the overlooked recession prospect," Hebe Chen, a market analyst from IG Markets said.

The Australian mining subindex .AXMM slumped as much as 5.3% to mark its worst day in nearly two months. The sector was the top laggard for the day. BHP Group (BHP) dropped after trading ex-dividend, while caution prevailed in China due to COVID-19 curbs.

Separately, Rio Tinto (RIO) said it would buy the remainder of Canada's Turquoise Hill TRQ.TO for $3.3 billion that would give the miner access to the massive Oyu Tolgoi project in Mongolia.

However, its shares still fell about 2%, in line with the broader market.

Gold stocks .AXGD hit their lowest in about three years, as sentiment for the precious metal was dampened following a robust U.S. dollar.

Sector heavyweights Northern Star Resources (NST) and Newcrest Mining (NCM) fell 5.1% and 3.7%, respectively.

Financials .AXFJ slipped 1.3%, with the "Big Four" banks dropping between 0.8% and 1.5%, while shares in domestic tech companies .AXIJ shed about 1.7%.

New Zealand's benchmark S&P/NZX 50 index (nz50) ended 0.1% higher at 11,609.8 points.