Losses across the board dragged the Australian share market lower, with energy stocks weighing the heaviest amid looming interest rate hikes in the US and tumbling oil prices.
The benchmark S&P/ASX200 index was down 68.8 points, or 1.22 per cent, at 5589.5 on Tuesday, while the broader All Ordinaries lost 1.24 per cent.
The US Federal Reserve is expected to raise interest rates this week and CommSec market analyst James Tao said investors will be keenly listening to Fed chair Jerome Powell for any indication for how many hikes are in-store for 2019.
"That will certainly impact on the potential growth story that has been weighing on global markets now for a while," he told AAP.
Buyers are also nervously keeping an eye on the Congress, with President Donald Trump threatening a partial shutdown of the government if funding for the proposed US-Mexico border wall is not approved.
Energy stocks lost nearly three per cent after oil prices fell on US supply concerns and fears over global economic growth.
Caltex recorded the heaviest loss among the major players, down 5.5 per cent to $25.57, after its Lytton refinery performance weighed heavily on its earnings outlook.
Meanwhile, Origin, Woodside, Oil Search, and Santos were down between 1.3 and 2.6 per cent.
ANZ suffered the heaviest losses of the big four lenders, down three per cent to $23.69, NAB and Westpac were 1.8 and 1.4 per cent lower respectively, while Commonwealth Bank lost one per cent to $68.60.
Macquarie Group fell 2.3 per cent to $110.63.
The gold miners provided rare lustre to the benchmark as the precious metal firmed more than $7 an ounce overnight against a softer US dollar, and limited the sector's losses to 0.2 per cent.
Northern Star was up 3.3 per cent to $8.56 and Newcrest climbed 1.5 per cent to $21.16.
Major miner BHP was flat at $33.50, while Bluescope fell 4.9 per cent.
Telecommunications was the only sector on the market consistently in the black through the day but Telstra pared its gains to 0.3 per cent and the index fell slightly into negative.
REA Group lost nearly two per cent after it appointed the former head of ANZ's Asian retail banking business as its new chief executive.
Auto classified site Carsales.com dropped two per cent to $11.52 following the announcement of a likely $48 million impairment on its share in Stratton Finance.
The Australian dollar strengthened against its US counterpart awaiting news from the US Federal Reserve.
The Aussie was buying 71.90 US cents at 1630 AEDT from 71.73 on Monday.
ON THE ASX:
* The benchmark S&P/ASX200 index was down 68.8 points, or 1.22 per cent, at 5589.5
* The All Ordinaries was down 71.1 points, or 1.24 per cent, at 5661.8
* At 1630 AEDT, the SPI200 futures index was down 91 points, or 1.6 per cent, at 5581
CURRENCY SNAPSHOT AT 1630 AEDT:
One Australian dollar buys:
* 71.90 US cents, from 71.73 US cents on Monday
* 80.92 Japanese yen, from 81.42
* 63.39 euro cents, from 63.43
* 56.97 British pence, from 57.03
* 104.94 NZ cents, from 105.62
GOLD:
The spot price of gold in Sydney at 1630 AEDT was $US1248.05 per fine ounce, from $US1236.83 on Monday.
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