Australian shares closed higher on Friday to mark a third straight weekly gain, as mining stocks led gains amid strength in global equities, with investors now eyeing US jobs data for further cues on the Federal Reserve’s policy stance.
The S&P/ASX 200 index ended 0.9% higher at 7,238.80. For the week, the benchmark rose 0.8%. Asian equities gained as investors hoped the US jobs report due later in the day might sway the Fed to slow its current aggressive pace of rate hikes over the coming months.
The Australian market started on a positive note, but it started fading from the peak as the day went since investors were not trusting the rebound, said Deep Data Analytics’ CEO Mathan Somasundaram.
Financials lift Australia shares after GDP growth beats estimates
“It is still being looked at as another bear market bounce.” Mining stocks rose 2.9% on strong iron ore prices. Heavyweights BHP Group and Rio Tinto rose 2.5% and 2.7%, respectively. Lithium miners also extended gains, with Pilbara Minerals , Liontown Resources, and IGO Ltd rising 4%-7.5%.
Financial stocks ended up 0.1% but snapped a two-week winning streak to record a 1.3% weekly loss.
Energy and gold stocks rose 1% and 2.1%, respectively. Separately, a Reuters poll found that the Reserve Bank of Australia (RBA) will raise rates by 25 basis points (bps) for a second straight meeting in June.
However, nearly a third of the polled economists predicted a 40 bps increase. “We think the strength of the price and wage measures in the GDP data should be enough to convince RBA to deviate from a regular 25 bps move and lift the cash rate a bit, a little faster,” economists at ANZ said in a note.
New Zealand’s benchmark S&P/NZX 50 index closed 0.6% higher at 11,417.34 — its best weekly gain in four months with a 3.2% jump.
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