Australian shares slipped 1 per cent on Monday, led by resources and financials, as oil prices fell to fresh five-year lows.
Also undermining the sentiment was a hostage siege in the heart of Sydney, where dozens of people were believed to be trapped inside a cafe, raising fears of an attack by Islamic militants.
The S&P/ASX 200 index fell 49.9 points to 5,169.60 by 01:20 GMT, its fifth straight session of losses, pulling closer to a two-month low of 5,122. A break under that could see a test of this year’s trough of 5,052.2.
Miners continued to spiral downwards as prices for iron ore, Australia’s biggest export earner, were near five-year lows. Rio Tinto and BHP Billiton shed around 2 per cent.
Qantas tumbled more than 6 per cent to A$2.255, even though oil prices touched a fresh five-year lows.
Leanne Jones, an analyst at Bell Direct, said investors booked profits following recent hefty gains on falling oil prices. Qantas shares have leapt 17 per cent so far this month.
The top performer of the session was Australian-listed data storage company Recall Holdings, which leapt 19 per cent to the highest since listing a year ago, after it rejected a A$2.2-billion takeover offer from larger United States rival Iron Mountain Inc.
Across the Tasman sea, New Zealand's benchmark NZX50 index slipped 33.96 points or 0.6 per cent to 5,480.9, weighed by a slide in outdoorwear manufacturer Kathmandu to a three-week low.
Kathmandu fell 4.4 per cent to NZ$2.81 after major domestic fund managers, including the New Zealand Superannuation fund, announced late last week they had trimmed their holdings in the underperforming company, which has lost nearly 20 per cent this year.
Also weighing on Kathmandu was a rise in the New Zealand dollar last week, which was seen threatening its overseas revenue.
Further NZX losses were limited by slight gains in OceanaGold, which rose 0.9 per cent as gold prices held most of their gains made during a rally last week.
Kiwi Income Property Trust popped up to a 6 1/2-year high of NZ$1.245 per cent, after the property trust said its unitholders had approved its corporatisation, which would result in cost savings.