* Tech sector biggest pct loser, slips 5.7%
* Benchmark set for weekly decline of about 4%
* NZ bourse sees worst drop in over three weeks
Sept 4 (Reuters) - Australian shares fell on Friday by their most in five weeks, with the technology sector hit hard, as major indexes on Wall Street saw their sharpest decline since June after investors dumped the high-flying technology stocks.
The S&P/ASX 200 index .AXJO declined as much as 2.6% to 5,953.60 by 1250 GMT, marking its biggest intraday percentage drop since July 31. It has fallen about 4% so far this week.
The tech-heavy Nasdaq Composite .IXIC lost 5% just a day after it posted a record close, with blue-chip tech stocks including Apple Inc AAPL.O and Microsoft Corp MSFT.O weighing the most. .N
The S&P tech sector .SPLRCT and the Philadelphia chip index .SOX both fell almost 6%.
Further dampening investor sentiment, Australia reported a record daily rise in COVID-19 cases in more than a week on Thursday, denting optimism that a stringent lockdown of its second-largest city will soon be lifted. of Thursday, Australia had recorded more than 26,000 COVID-19 cases, with the death toll reaching 678.
Investors are now awaiting retail sales data, expected later in the day, for further cues about the domestic economy. The data is likely to show an uptick in July sales over the previous month. top losers on the benchmark, tech firms .AXFJ dropped as much as 5.7%, mirroring losses in U.S. peers. The drop marked the sub-index's worst intraday session since March 23.
Buy now, pay later firm Afterpay APT.AX slipped up to 9.1%, while Xero XRO.AX lost 5%.
Miners .AXMM weighed the most on the index, declining 2.6% as escalating diplomatic tensions between Canberra and Beijing continued to eclipse a rally in iron ore futures in China. IRONORE/
Heavyweight iron ore miners BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX were down 3.5% and 2.5%, respectively.
In New Zealand, the benchmark S&P/NZX 50 index .NZ50 lost as much as 1.4% to 11,885.57, marking its biggest intraday drop since Aug. 12.
Blue-chip firms like Fisher & Paykel Healthcare FPH.NZ and dairy firm a2 Milk ATM.NZ were among the top losers.