Rate Hike Fears Weigh on Aussie Sharemarket

Fears of interest rate hikes weighed on the Australian sharemarket on Monday, leading to a 'defensive rotation' among traders.

The benchmark ASX 200 index rose by just 0.70 points or 0.01 per cent to 8731.90, while the broader All Ordinaries slipped 3.60 points or 0.04 per cent to 8919.10.

Healthcare and financials stocks bucked the trend, with Commonwealth Bank, National Australia Bank, Westpac, and ANZ all posting gains.

However, technology shares suffered losses, including a 4.30 per cent drop in Xero's price to $60.08.

The Reserve Bank of Australia governor Michele Bullock warned on Friday that the upside risks to inflation had 'materialised', prompting money markets to fully price in another interest rate hike by September 28-29.