Australian shares have continued to fall with major miners and banks dragging on the market, after Wall Street indices lost steam due to concerns about tax hikes for companies and the rich. 

The benchmark ASX 200 was down 0.5 per cent, to 7,397, while the broader All Ordinaries had dropped by 0.6 per cent, to 7,701, at 12:20am AEST.

Shares in heavyweight miners BHP and Rio Tinto fell 2.6 per cent and 2 per cent respectively due to softer iron prices.

It comes as the price of iron ore fell 1.8 per cent overnight, to $US121.67 a tonne.

The big four banks were also trading down. CBA, NAB and Westpac stocks fell 0.5 per cent, while ANZ was down 0.3 per cent. 

Energy stocks like Santos fell 2.47 per cent, followed by Beach Energy, which lost 2.5 per cent. 

The best-performing stocks were Pilbara Minerals (+8.4 per cent), Elders (+3.1 per cent), Altium (+2.8 per cent) Super Retail Group (+2.6 per cent) and Stockland (+2.6 per cent). 

Meanwhile, the worst performers were AGL Energy (-8.8 per cent), Blackmores (-4.6 per cent), Janus Henderson Group (-4.5 per cent) and Iress Limited (-3.9 per cent).

Consumer confidence up

The Westpac-Melbourne Institute consumer confidence index rose 2 per cent in September after falling 4.4 per cent in August.

Consumer sentiment in New South Wales lifted 5.3 per cent, after the state flagged a loosening of restrictions for the fully vaccinated.

In Victoria, confidence was steady despite the state extending its lockdown. 

The national index was up 13.2 per cent on September last year.

“The resilience of consumer sentiment in a period when Australia’s two major cities have been locked down and the economy has been contracting is truly remarkable," Westpac Chief Economist Bill Evans said. 

The "time to buy a house" measure was up 8.8 per cent despite expectations about further price rises up 1.4 per cent.

Wall Street mixed

On Wall Street, the benchmark S&P 500 dipped 0.6 per cent, to 4,443, and the Dow Jones Industrial Average shed 0.8 per cent, to 34,577, while the tech-heavy Nasdaq lost 0.5 per cent, to 15,077.

All 11 major sectors in the S&P 500 ended the session in the red. Energy and financials suffered the largest percentage drops.

Apple stocks closed almost 1 per cent lower, despite the launch of its latest iPhone.

On the other hand, Microsoft closed 0.9 per cent higher.

Bank of America fell 2.6 per cent, while General Electric tumbled 3.9 per cent.

Intuit gained 1.9 per cent after the TurboTax maker's announcement that it would acquire digital marketing company Mailchimp for $12 billion. 

CureVac slid 8.0 per cent after the German biotechnology company cancelled manufacturing deals for its experimental COVID-19 vaccine. 

Initially, the US markets rallied in response to better-than-expected inflation data, but the good mood soon faded. 

The cost of consumer goods rose 5.3 per cent from a year earlier and were up 0.3 per cent from July. However, inflation was less than analysts expected. 

"From a seasonality perspective, September tends to be the window-dressing period for fund managers."

Downward pressures

New taxes for the wealthy were also on the mind of investors.

The Democrats have proposed hiking the tax rate on corporations and wealthy people to 26.5 per cent, from 21 per cent, to fund a $US3.5 trillion social safety net and climate policy bill.

Meanwhile, the advent of the highly contagious Delta COVID-19 variant has driven an increase in bearish sentiment about the recovery from the global health crisis, with many now expecting a substantial correction in stock markets by the end of the year. 

"Economic data points have been missing estimates, and that has coincided with the rise in the Delta variant," he said.

Gold and oil up

Spot gold was up 0.1 per cent, to $US1,803 an ounce, at 12:23pm AEST. 

On oil markets, Brent crude was up 0.4 per cent, to $US73.88 per barrel.

West Texas crude was up 0.3 per cent, to $US70.77 cents per barrel.

In European markets, the STOXX 600 index was flat, at 467.65, Germany’s DAX was up, to 15,722, and Britain's FTSE was down 0.5 per cent, to 7,043.

ABC/Reuters