The local share market has closed lower, with gains by oil and gas producers outweighed by losses from tech and real estate companies as another central bank raised rates.
The benchmark S&P/ASX200 index was flat at midday on Thursday but slid into negative territory in the afternoon to finish down 18.3 points, or 0.26 per cent to a one-week low of 7,099.7.
The broader All Ordinaries dropped 22.1 points, or 0.3 per cent, to 7,288.3.
The Bank of Canada surprised markets overnight with its first rate hike in five months, taking its target rate to 4.75 per cent in a bid to combat "stubbornly high" underlying inflation.
"While economic growth around the world is softening in the face of higher interest rates, major central banks are signalling that interest rates may have to rise further to restore price stability," the Bank of Canada said.
Following the decision, futures markets increased their implied odds that the US Federal Reserve would hike rates next week.
They are now pricing-in a 38 per cent chance of a rate hike, up from 22 per cent chance a day earlier, according to the CME FedWatch Tool.
The ASX's tech sector fell 3.8 per cent on Thursday and the property sector dropped 2.5 per cent, its worst session in 11 weeks.
"All things being equal, higher interest rates negatively impact real estate values," IG analyst Tony Sycamore noted.
"For integrated property groups such as Goodman Group, who own, develop, and manage properties, raising funds in an environment of rising interest rates can be a challenge, as is raising rents and increasing profits."
And for shopping centre owners such as Stockland, their retailer tenants simply can't afford to pay higher rents in the current environment, Mr Sycamore added.
Goodman Group closed down 2.4 per cent to a one-month low of $19.40, Stockland dropped 3.7 per cent to an eight-week low of $4.12 and fellow developer Mirvac Group retreated 3.4 per cent to $2.25.
In tech, which is also sensitive to interest rate hikes, Xero fell 5.3 per cent, Altium dropped 4.9 per cent and Technology One dipped 2.3 per cent.
On the flip side, the energy sector finished up 1.3 per cent after two days of losses.
Woodside climbed 1.1 per cent, Santos gained 0.7 per cent and Whitehaven Coal rose 5.5 per cent.
In the heavyweight materials sector, the big iron ore miners were all higher while gold miners were lower as the prospect of higher rates dragged on the fortunes of the non-yield bearing yellow metal.
BHP gained 1.2 per cent to $44.13, Rio Tinto climbed 2.1 per cent to $114 and Fortescue added 1.7 per cent to $20.50.
But Newcrest dipped 0.6 per cent, Northern Star slipped 2.2 per cent and Evolution finished down 3.4 per cent.
Elsewhere in the sector, building company Boral tumbled 5.7 per cent to a one-week low of $3.94 after CEO Vik Bansal told investors that concrete sales had slowed in recent weeks as higher rates weighed on demand for new home-building.
The Big Four banks were mixed, with Westpac the biggest mover, up 0.8 per cent to $20.19.
CBA gained 0.2 per cent to $95.89 but ANZ slid 0.2 per cent to $22.68 and NAB dropped 0.6 per cent to $25.16.
Air New Zealand gained 1.4 per cent to 70.5c after the Kiwi flag carrier raised its full-year earnings forecast to at least $NZ580 million, from an earlier range of $510-$560m.
There's been ongoing demand for travel recently, in what is usually Air New Zealand's off-peak period, and the cost of jet fuel has slid further to levels consistently below the airline's assumptions from April.
In health care, Avita Medical soared 10.7 per cent to $4.75 after the US medical regulator expanded its approval for Avita's spray-on skin regeneration product, which CEO Jim Corbett described as a landmark approval that represented an "inflection point" for the Melbourne company.
The Australian dollar was buying 66.66 US cents, from 66.71 US cents at Wednesday's ASX close.
ON THE ASX:
* The benchmark S&P/ASX200 index finished Thursday down 18.3 points, or 0.26 per cent, at 7,099.7.
* The broader All Ordinaries fell 22.1 points, or 0.3 per cent, to 7,288.3.
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 66.71 US cents, from 66.71 US cents at Thursday's ASX close
* 93.01 Japanese yen, from 93.01 Japanese yen
* 62.45 Euro cents, from 62.45 Euro cents
* 53.77 British pence, from 53.77 British pence
* 109.99 NZ cents, from 109.99 NZ cents
