Australian shares rose on Thursday led by banks and gold stocks, as investors were optimistic over the US Federal Reserve’s decision to hold on to its projection of three interest rate cuts this year.
The S&P/ASX 200 index rose 0.7% to 7,749.7 by 1210 GMT, set for its best session in two weeks.
The Fed held interests rates steady on Wednesday but still saw the rates falling at least three-quarters of a percentage point by this year end despite recent high inflation readings.
On the domestic front, data showed that Australia’s employment rebounded sharply in February, with jobless rate diving far below forecasts, suggesting the labour market was still tight.
“With seasonal issues, again evident in the (jobs) data, it will cause some hesitation in reading too much into the hot headline number,” said Tony Sycamore, analyst at IG Australia.
Heavyweight financials led gains, rising 0.9%, eyeing the sub-index’s best session in two weeks.
The “Big Four” banks gained between 1.2% and 1.9%. Miners rose 0.7% as iron ore futures extended gains for a third straight session on hopes of better demand from China.
Mining behemoths BHP Group, Rio Tinto and Fortescue were all trading in the green. Gold stocks climbed a more than two-month peak, as bullion prices hit a record high. Northern Star Resources and Evolution Mining advanced 3.8% and 5.6%, respectively.
Banks, energy stocks push Australian shares higher; Fed decision in focus
Meanwhile, rate-sensitive real estate stocks surged as much as 1.6% to touch a near two-year high. Mirvac Group added 2.8% and Dexus rose 0.4%.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index recovered earlier losses to trade marginally higher at 11,836.29.
The country’s economy shrank slightly in the fourth quarter, putting the country into a technical recession and increasing chances of the central bank cutting rates sooner than expected earlier.
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