Australian shares climb to one-week high as easing US-Iran tensions lift sentiment

Australian shares hit a one-week high on Friday, with gold and mining stocks leading gains as easing US-Iran tensions boosted risk appetite after US President Donald Trump called off planned strikes on Iran.

The S&P/ASX 200 index rose 1.8% to 8,789.10 by 0032 GMT, its highest level since June 3.

The benchmark was also set to log its best week since mid-April.

It fell 0.2% on Thursday.

Investors capped out a week marked by swings in Middle East tensions, with sentiment improving overnight after Trump said a peace deal with Iran could be signed as soon as this weekend, potentially reopening the Strait of Hormuz, although Tehran said no final decision had been made.

Markets remain focused on developments, as any disruption to oil supplies could rekindle global inflation concerns.

However, in Australia, softer monthly jobs and inflation prints strengthened expectations that the Reserve Bank of Australia will leave rates unchanged at its meeting on Tuesday after three rate hikes earlier this year.

Gold stocks led gains and jumped as much as 6.3%, on track for their best session in two months.

Evolution Mining and Northern Star Resources added 6.3% and 4.7%, respectively. Following suit, miners advanced 3.8%, on track to log its best day since April 8. Bellwethers BHP Group, Rio Tinto and Fortescue gained between 1.7% and 2.3%.

Financials rose 1.8%, with the “Big Four” banks up between 1.1% and 1.7%. Technology stocks tracked their overseas peers higher and climbed 2.1%.

Bucking the trend, energy stocks fell 2% and was set to mark its worst week since late May. Oil and gas firm Santos lost 1.6%.

Woodside Energy shed 2.3%.

The company said it exercised its pre-emptive right to acquire PetroChina’s 10.67% stake in the Browse gas fields off the coast of Western Australia, blocking a deal agreed with Japan’s Inpex.

In New Zealand, the benchmark S&P/NZX 50 index rose 0.7% to 13,291.46.