The S&P/ASX200 on Thursday closed down 30 points, or 0.4 per cent, to 7969.0, while the broader All Ordinaries fell 39.6 points, or 0.5 per cent, to 8185.5.
Trade war tensions have already been dampening investor sentiment and US President Donald Trump locking in a 25 per cent tariff on cars and light trucks made outside the country from April 2 has deepened concerns.
Australian automotive parts businesses were down a little, with Eagers Automotive shares sliding 2.7 per cent and Babcor losing 2.5 per cent.
The ASX200 snapped a five-day rally on Thursday, with seven of the 11 sectors lower.
Property, consumer discretionary and technology sectors posted the sharpest declines, with the latter in line with losses clocked by US tech heavyweights.
Higher oil prices helped prop up energy stocks, with Woodside up 1.5 per cent, to $23.60.
Mining stocks also eked out gains, with BHP lifting 0.3 per cent, to $39.64, and Rio Tinto rising 0.1 per cent, to $120.09.
Fortescue shares were unchanged at $16.21.
Core Lithium finished 5.3 per cent higher after identifying opportunities to lower operating costs and improve productivity as part of an update on a restart study for its Finniss Lithium Operation in the Northern Territory.
The big banks were mixed, with Commonwealth Bank shares sinking 0.1 per cent, to $150.04.
The remaining three fared better, led by Westpac, up 0.7 per cent, to $31.65, followed by NAB, gaining 0.4 per cent, to $34.10, and ANZ, finishing 0.1 per cent higher, at $29.48.
Shares in property marketplace Domain dived 4.9 per cent after US property giant CoStar sweetened its takeover bid in a "best and final" offer of $4.43 a share, up 5.5 per cent from the original $4.20 per share.
Pathology services provider Healius logged a 10.7 per cent gain after committing to a fully franked special dividend of 41.3 cents per share following the successful sale of its Lumus imaging business.
The Australian dollar was buying 63.13 US cents, up from Wednesday afternoon's 63.08 US cents.
ON THE ASX:
* The benchmark S&P/ASX200 index fell 30 points, or 0.4 per cent, to 7969.
* The broader All Ordinaries was down 39.6 points, or 0.48 per cent, to 8185.5.
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 63.13 US cents, from 63.08 US cents on Wednesday
* 94.81 Japanese yen, from 95.01 Japanese yen
* 58.56 euro cents, from 58.55 euro cents
* 48.86 British pence, from 48.84 British pence
* 109.95 NZ cents, from 109.80 NZ cents.
