The sharemarket snapped a seven-day winning streak after a lacklustre earnings report by Westpac and a plunge in the oil price sent banks and energy stocks tumbling.

The benchmark S&P/ASX 200 Index fell 1 per cent, or by 80.2 points to 8157.8 points at the close, with all 11 sectors in the red. That was its largest one-day fall since April 9, when the US increased tariffs on imports from China. The All Ordinaries also fell 1 per cent.

A worse-than-expected earnings report by Westpac sparked a sell-off in the big banks after its interim profit missed expectations. Some investors also cast doubt on its plan to double down on business and institutional loan growth. The shares dropped 3 per cent to $32.45.

‘Love-hate relationship’

The result prompted selling across the sector in a big week for earnings. Commonwealth Bank dropped 1.6 per cent to $166.93 and National Australia Bank slid 1.8 per cent to $35.85.

JPMorgan global market strategist Kerry Craig said the sell-off in banks was a stark reminder of investors’ high expectations for earnings and growth projections, given the lofty valuations in the sector.

“It’s not necessarily that investors have a love-hate relationship with Australian banks – investors want to hold them to a degree,” he said. “But like the expensive technology companies in the US, even when these companies report strong earnings, the hurdle rate is becoming higher and higher.”

Energy stocks also weighed on the bourse, tracking a 2.8 per cent fall in the price of Brent oil to below $US60 a barrel after OPEC+ announced a dramatic increase in output. Oil and gas giants Woodside and Santos dropped 3.6 per cent and 4 per cent to $19.87 and $5.84, respectively.

Weaker US futures also cast a risk-off mood across the market as consumer and real estate stocks reversed some earlier strength. Trump claimed on Sunday that tariffs on China would come down “at some point”, but later clarified that he had no plans to speak to Beijing this week.

In currencies, the Australian dollar touched a year-to-date high of US64.81¢ as the greenback weakened and China’s offshore yuan soared to a six-month record.

Stocks on the move

In corporate news, Gold Road Resources leapt 9.4 per cent to $3.25 after announcing it had succumbed to the advances of South Africa’s Gold Fields after the latter sweetened its takeover offer to $3.7 billion.

Healius jumped 4 per cent to $1.57 after the diagnostic imaging provider announced a fully franked special dividend worth 41.3¢ a share.

Reliance Worldwide retreated 2.4 per cent to $4.09 after reporting that it expected US tariffs to erase $US25 million ($38.7 million) to $US35 million from its full-year earnings in 2026.

Smartpay soared 21.7 per cent to 92.5¢ on Monday after the company, which is part of the All Ordinaries index, entered exclusive talks with an unnamed suitor proposing to acquire it for $NZ1.20 ($1.12) a share.

While the news excluded rival Tyro Payments from the negotiating table, the payments provider closed up 11.6 per cent to 86.5¢.