Australian shares climbed marginally on Thursday, led by a rise in gold stocks, while investor sentiment bolstered after US lawmakers voted to approve a bill to suspend the federal debt ceiling.
The S&P/ASX 200 index rose 0.3% to close trading at 7,110.8.
A divided US House of Representatives passed a bill to suspend the $31.4 trillion debt ceiling on Wednesday, with majority support from both Democrats and Republicans to overcome opposition led by hardline conservatives and avoid a catastrophic default.
“The hardest part for the bill will be getting it through the Senate, which if it does will be positive for the Australian market as it relieves some uncertainty about the fiscal situation in the US,” said Carl Capolingua, market analyst at ThinkMarkets Australia.
A prolonged deadlock could have wider ramifications for global economic growth, Capolingua added. Meanwhile, weak manufacturing data in China has raised hopes of policy support for the industry and a possibility of Beijing rolling out stimulus policies to revive the economy.
However, ThinkMarkets’ Capolingua is still leaning towards the “bearish side of the ledger on Chinese economic growth,” saying more stimulus could potentially worsen the situation due to existing debt.
Australian shares extend fall after hotter-than-expected inflation data
Local investors are now keenly waiting for the Reserve Bank of Australia’s interest rate hike decision scheduled for next week.
There is a possibility of an increase in interest rates to 4% from 3.85%, Capolingua added.
On the local bourse, gold stocks turned the top gainers, rising 2.6%.
Tech and healthcare stocks added 1.1% and 1.2%, respectively. Energy stocks added 0.4% to the benchmark. New Zealand’s benchmark S&P/NZX 50 index rose 0.9% to 11,916.13 at the close of the trading.
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