Markets

Australia shares gain ahead of central bank meeting

  • The S&P/ASX 200 index rose 0.29% to 7,336.2 points by 0030 GMT
Published July 6, 2021

Australian shares opened higher on Tuesday, boosted by energy and mining stocks, ahead of the Reserve Bank of Australia's meeting in which it is expected to leave its cash rate at a record low to help boost employment and inflation.

The S&P/ASX 200 index rose 0.29% to 7,336.2 points by 0030 GMT.

Elsewhere, Japan's Nikkei gained 0.11% and S&P 500 E-minis futures were up 0.07%.

Economists expect the RBA to leave its cash rate at 0.1% and adopt a "flexible" approach to its bond-buying programme, a Reuters poll showed. The decision is expected at 0430 GMT.

The central bank in June had signalled it would extend its bond purchase programme beyond September. However, signs of broader economic recovery may embolden the RBA to slightly temper its stimulus.

On Monday, data showed Australian job advertisements extended their record-breaking run in June as demand for labour remained strong despite a round of coronavirus lockdowns across the country, a sign any drag on the economy will likely be fleeting.

Among sectors, energy stocks rose 1.8% to their highest level in more than two weeks, helped by stronger oil prices after OPEC+ nations called off talks on output levels.

Gas explorers Woodside Petroleum and Santos advanced 1.3% and 2.2%, respectively.

Mining stocks rose 1% a day after benchmark Chinese iron ore futures jumped 5% on rising demand as mills in steel hub Tangshan resumed production.

Global miners BHP Group and Rio Tinto advanced 1.2% and 1%, respectively.

The country's second largest lender Westpac Banking Corp rose nearly 1% after saying it would sell its New Zealand life insurance business for NZ$400 million ($280.84 million).

New Zealand's benchmark S&P/NZX 50 index fell 0.5%, hurt by losses in healthcare and industrial stocks.

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