At lunchtime AEST on Thursday, the benchmark S&P/ASX200 was down 22.5 points, or 0.28 per cent, to 8,035.4, while the broader All Ordinaries had dropped 30.8 points, or 0.37 per cent, to 8,272.7.
Late Thursday morning the Australian Bureau of Statistics reported that number of employed persons grew by 50,000 in June, while the number of unemployed climbed by 10,000. Overall the unemployment rate ticked up by less than a tenth of a percentage point, to 4.1 per cent.
Sean Langcake, head of macroeconomic forecasting for Oxford Economics Australia, said the readout would provide a mixed read for the Reserve Bank ahead of its next meeting in early August.
"The labour market is slackening, with the upward drift in the unemployment rate becoming more entrenched," Mr Langcake said. "But the market remains is a very tight position. The current pace of employment growth suggests demand is resilient and cost pressures will remain."
Both RBC Capital Markets chief economist Su-Lin Ong and J.P. Morgan economist Tom Kennedy said the readout probably wouldn't tip the scales one way or the other for the Reserve Bank, which will probably put more weight on the second-quarter inflation readout due July 31.
Eight of the ASX's 11 sectors were lower at midday while energy, consumer staples and utilities were slightly higher.
The tech sector was the biggest mover, down 3.3 per cent, on track for its worst single-day loss since a 3.9 per cent decline on April 3.
The plunge followed a similar selloff on Wall Street, where the tech-heavy Nasdaq fell 2.8 per cent - its worst loss in 18 months - on a report that the US was considering imposing tough sanctions on China's semiconductor industry.
Wisetech Global had dropped 5.9 per cent, NextDC and Life360 were both down 4.2 per cent and Xero had fallen 2.9 per cent.
Also, carsales.com.au owner CAR Group had dropped 3.0 per cent and realestate.com.au owner REA Group was down 3.4 per cent, although both are officially listed in the communications sector.
In the consumer discretionary sector, Domino Pizza Enterprise had fallen 9.1 per cent to a nine-year low of $32.81 after the fast food operator said it would close dozens of underperforming stores in Japan and France.
On the flip side, Accent Group had climbed 8.4 per cent to a five-month high of $2.125 after the sneaker retailer said trading conditions had improved in the second half, with like-for-like sales 4.1 per cent ahead of the prior year.
In the heavyweight mining sector, Evolution had grown 3.4 per cent to $4.115 after the goldminer reported record June quarter cash flow of $230 million, up from $85 million in the March quarter.
Elsewhere in the sector, BHP was down 0.2 per cent, Fortescue had dropped 0.8 per cent and Rio Tinto had fallen 0.4 per cent.
Three of the four big retail banks were higher, with NAB up 0.4 per cent, Westpac adding 0.3 per cent and ANZ advancing 0.2 per cent. CBA was the outlier, dropping 0.5 per cent.
Former messageboard favourite Zip Co was up 10.9 per cent to a one-week high of $1.789 after completing a $217 million capital raising at a slim 2.8 per cent discount.
Droneshield was down 1.9 per cent to $1.795, as investors hoped it was close to a bottom after heavy losses Tuesday and Wednesday.
The Australian dollar was buying 67.39 US cents, from 67.33 US cents at Wednesday's ASX close.
