Australian shares posted a marginal weekly loss, although they ended higher on Friday as investors seemed unvexed by US Federal Reserve officials’ hawkish comments while global miner BHP Group’s improved bid for OZ Minerals also lifted sentiment.
The S&P/ASX 200 index ended 0.2% higher at 7.151.80. The benchmark lost about 0.1% this week.
“Overall Australian investors are assessing whether the market has stabilised and this is a good time to start buying,” said Russel Chesler, head of Investments and Capital Markets at VanEck Australia.
The Aussie market was not fazed by the overnight drop in US equities on the back of comments by St. Louis Fed President James Bullard saying the central bank needs to keep raising interest rates, Chesler said.
Minneapolis Fed Bank President Neel Kashkari said the US central bank should not stop rate hikes until it’s clear that inflation has peaked.
Heavyweight financials rose 0.6% to lead the gains on the Australian benchmark index.
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The “Big Four” banks climbed between 0.2% and 1.8%.
BHP Group Ltd climbed 0.3% after delivering a A$9.6 billion ($6.5 billion) bid for copper and gold producer OZ Minerals, in what could be the largest mining deal in Australia in 11 years. OZ Minerals surged 4% and was among the top gainers on the benchmark.
The mining sub-index ended flat even as iron ore prices advanced.
Technology and healthcare stocks also ended marginally higher.
Energy stocks fell 0.4%, mirroring the weakness in overnight oil prices, and were the top losers on the benchmark index. Explaining the sentiment on the local bourse Chesler said,
“We do not believe that this is the end of the bear market as inflation is still well above the RBA’s 2% to 3% range and remains sticky but … Investors will continue to make opportunistic purchases.”
Meanwhile, a Reuters poll found that New Zealand’s central bank will hike rates by 75 basis points for the first time next week to cool multi-decade high inflation.
The country’s benchmark S&P/NZX 50 index closed 0.8% higher at 11,380.61.
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