The S&P/ASX 200 index reached as low as 5268 points near midday before closing 0.4% lower than yesterday at 5276.

Miners were among the session’s biggest losers with the basic materials sector falling 0.8%.

BHP Billiton finished 0.8% lower at $A36.39 and Rio Tinto fell back 1.1% to close at $62.91.

The retreat followed Wall Street leads, which analysts have roundly attributed to a settling effect after the US Federal Reserve’s surprise decision to maintain its stimulus program sent the market flying earlier this week.

Other factors influencing trading included sharp movements in the price of gold and a rally in the Australian dollar (last trading at US94.5c) – which is reportedly prompting traders to step up bets that the Reserve Bank of Australia will cut interest rates.

“There’s a symmetry between an Aussie rally and Australian rates,” Westpac banking global head of foreign exchange Hugh Killen told Bloomberg.

“As the Aussie continues up toward 97c the chances of the next rate cut from the RBA increase and that will, in turn, obviously take the steam out of an Aussie rally.”

Gold miners continued to come down from a post-Fed decision high as the price of the precious metal (last trading at about $1362 per ounce) continued to back off its recent surge.

International Goldfields was a standout loser for the yellow metal, down 33.3% to A0.4c, followed by Leyshon Resources, down 8.6% to 16c and Celamin Holdings, down 8.33% to 5.5c.

Ampella Mining, meanwhile, lost 17.2% to 12c after posting drill results for its Napelapera gold prospect in Burkina Faso.

Iron ore companies were subdued on a steady price for the commodity (about $US131.80 per tonne) and gathering gloom about Chinese near-term appetite for steel.

Arrium stood out with a 5% fall to $A1.24.