Australian shares crossed the key 8,900 level for the first time on Friday, buoyed by gains in major banks as investors piled into financials despite stretched valuations on hopes that rate cuts would spur credit and economic growth.
The S&P/ASX 200 index was up 0.2% at 8,894.60, as of 0103 GMT, after briefly crossing the 8,900 mark earlier in the day.
The benchmark touched an all-time high of 8,901.80 points.
The index was up about 1% for the week in what would be its second straight weekly gain.
The Reserve Bank of Australia cut the cash rate by 25 basis points on Tuesday, matching market expectations, and leaving its door open for further policy easing this year to meet inflation and employment goals as the economy has lost some momentum.
Financial and real estate stocks are expected to benefit from lower cash rates, which usually lead to higher lending volumes.
Banks have risen 0.3% so far this week in what could be their third straight week of gains.
Top lender CBA was down 0.3% for the day and set to log a weekly loss of 5.6%, its worst since mid-February.
CBA reported a record annual profit on Wednesday, but investors dumped its shares on valuation concerns. Shares of ANZ were trading 1.3% higher after the country’s fourth-largest bank in terms of market value reported a rise in deposits and loans for the third quarter.
Tony Sycamore, market analyst at IG, also credited the index’s momentum to strong corporate earnings of this week, including from Westpac, Suncorp and Origin. Real estate stocks climbed 0.2%, with Charter Hall Retail REIT and Goodman Group rising about 0.3% each.
Miners climbed 0.6% even after iron ore prices closed lower overnight.
BHP and Rio Tinto climbed 0.6% each, while Fortescue rose 1.3%. New Zealand’s benchmark S&P/NZX 50 index rose 0.3% to 12,865.81. Reuters
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