SYDNEY — Australian shares suffered their worst trading day since March on Thursday, with the benchmark S&P/ASX 200 index tumbling 136.4 points, or 1.53%, to 8,775.0 by early afternoon, wiping roughly $50 billion off the local market as surging oil prices and rising global bond yields rattled investor sentiment.

The index fell as much as 1.8% during the session to touch 8,751 points, sending the ASX 200 to its lowest level in two-and-a-half months, back to where it stood on July 2. The decline effectively erased all of the market's gains accumulated over the preceding 10 weeks, with every major sector trading lower for a stretch of the session, including energy stocks, which fell despite the very commodity price surge that had helped trigger the broader selloff.

Brent crude oil climbed to $101.60 a barrel during Thursday's session, according to Motley Fool Australia, as tensions between the United States and Iran continued escalating following the weekend's exchange of strikes involving oil tankers and warships. The rise in oil prices has added further pressure to already elevated inflation expectations, pushing global bond yields higher and complicating the outlook for interest rates across major economies.

The U.S. 10-year Treasury yield climbed to around 4.84% overnight, its highest level since 2023, while Australian bond yields moved higher in tandem. That shift in the rate outlook has been reflected directly in market pricing for the Reserve Bank of Australia's next policy decision,........

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