Australian shares tumble as firmer bond yields, fall in tech stocks weigh

© Reuters.

* Australian cenbank announces unscheduled bond purchase

* Tech stocks drop tracking Wall Street peers

* New Zealand snaps six sessions of losses (Updates to close)

By Soumyajit Saha

Feb 26 (Reuters) - Australian shares closed at their lowest level in nearly a month on Friday, with tech stocks leading the declines, as risk assets lost their sheen after global bond yields firmed on expectations of economic expansion and rising inflation.

The S&P/ASX 200 index .AXJO ended 2.4% lower at 6,673.3, marking its sharpest fall since Sept. 4, 2020. For the week, the index shed 1.8%.

Yields on Australian and global bonds continued to rise, prompting the Reserve Bank of Australia to launch an unscheduled offer to buy three-year government bonds. central bank's monthly meeting on Tuesday will also be closely watched for comments on the volatility from the bond sell-off, but we don't expect any major policy changes," said Steven Daghlian, market analyst with CommSec.

Higher bond yields make equities look less attractive as they diminish the lure of stocks' dividend payouts, and make debt servicing harder for companies.

Tech stocks .AXIJ dived 5.3% and lost 12.8% over the week, mirroring a downturn in their Wall Street peers, with fintech co Afterpay Ltd APT.AX dropping 11%. stocks .AXEJ skid 2.5%, hurt further by a fall in oil prices. O/R

Oil & gas explorers Woodside Petroleum WPL.AX and Oil Search OSH.AX lost 3.4% and 2.1%, respectively.

Miners .AXMM fell 2.1% despite higher metal prices, with BHP Group BHP.AX and Fortescue Metals Group FMG.AX shedding 2.6% and 4.5%, respectively.

Financials .AXFJ also slid, with the so-called "Big Four" banks falling between 2% and 2.6%.

Commercial explosives maker Orica ORI.AX was the biggest percentage loser on the benchmark index after it said the trade spat between Australia and China will hit its sales to thermal coal mining customers. New Zealand, the benchmark S&P/NZX 50 index .NZ50 snapped a six-session losing streak to end 0.7% higher, helped by gains among utility and industrial stocks.