SYDNEY, AAP – Stocks were in freefall and down nearly two per cent as the Australian market followed a Wall Street plunge.

Financial shares fell most, 3.37 per cent. Market heavyweight the Commonwealth Bank shed 4.54 per cent to $98.98.

All industry categories were down. There were losses of more than one per cent for energy, materials, industrials, consumer discretionaries and telecommunications.

Wall Street plunged late last week after a Federal Reserve official made comments about sooner-than-expected rate hikes.

US central bank official James Bullard said he saw rate increases beginning as early as next year to curb rising inflation, spooking investors already worried about higher rates by 2023.

The benchmark S&P/ASX200 index was lower by 141.6 points, or 1.92 per cent, to 7227.3 at 1200 AEST on Monday.

The All Ordinaries was down by 145.2 points, or 1.90 per cent, to 7479.1.

Meanwhile Victoria’s COVID-19 lockdown has weighed on retail spending for May.

Spending in May rose by just 0.1 per cent, according to the Australian Bureau of Statistics.

This compared with a 1.1 per cent increase in April.

On the ASX, there were plenty of bank shares moving lower.

Bendigo Bank dropped 4.58 per cent to $10.41. Bank of Queensland lost four per cent to $8.87.

Among the Commonwealth’s peers in the big four, ANZ lost 3.1 per cent to $28.08, NAB shed 2.6 per cent to $26.17 and Westpac dipped 2.79 per cent to $26.13.

The Commonwealth’s share price decline came despite news is selling its general insurance business to the Hollard Group.

Hollard will pay $625 million for CommInsure General Insurance, and then pitch home and vehicle insurance to CBA customers through channels such as the CommBank app.

Hollard and the bank have forged a 15-year pact.

The big miners had sizeable losses.

BHP dropped 1.65 per cent to $45.75. Fortescue was down 1.87 per cent to $22.00. Rio Tinto slid 2.6 per cent to $120.25.

Biopharmaceuticals provider Starpharma plunged 9.26 per cent to $1.57 after it stopped selling its antiviral nasal spray in the UK.

A UK regulator has raised concern with claims about the product and COVID-19.

Starpharma is trying to resolve the dispute so it can continue selling the spray.

Building products supplier Boral will sell its North American business for $US2.15 billion ($2.9 billion).

A subsidiary of Westlake Chemical Corporation will buy the business.

Boral shares were down by 0.07 per cent to $6.77.

The Australian dollar was buying 75.04 US cents at 1200 AEST, lower from 75.41 US cents at Friday’s close.