Police confirmed the man, 21, who witnesses say yelled "Allahu akbar" – or "God is great" – during the incident, has been arrested and is being questioned.

The body of a 21-year-old woman was found in an apartment building near the scene, at a busy intersection in Sydney.

Another woman, aged 41, was stabbed in the back in the street and has been taken to hospital where she is in a stable condition.

Lee Cuthbert, Paul O'Shaughnessy and his brother Luke, all from Manchester, were working in their recruitment company office when they heard shouting in the street and gave chase.