Australian shares gained for a sixth straight session on Monday, backed by gains in gold stocks and banks, while investors eyed minutes of the June policy meeting of the country’s central bank for insights into its policy direction.
The S&P/ASX 200 index finished 0.6% higher at 7,294.90, touching its highest level since May 2.
The Reserve Bank of Australia’s minutes of its June policy meeting, due on Tuesday, will provide clues on whether it will continue hiking the benchmark interest rate.
“Given the Fed’s threat of another 50-basis-point worth of hikes and the strong Australia employment report, hawkish comments in the minutes may carry more weight and increase the odds of a July hike – which could be all but a given if the next inflation report comes in hot”, said Matt Simpson, senior market analyst at City Index. In Sydney, gold stocks advanced 1.2%.
Heavyweights Newcrest Mining gained 1.5% and Northern Star Resources added 0.9%.
Banks followed suit, rising 0.9%, The so-called “Big Four” banks in Australia rose between 0.8% and 1.5%.
National Australia Bank and ANZ Group and Westpac now forecast the RBA would lift cash rates to a peak of 4.6%, while Commonwealth Bank of Australia expects only one more hike in August to 4.35%.
Australian shares climb for fifth session in broad-based buying
Bucking the trend, energy stocks fell 0.6%, tracking lower oil prices, and miners slid 0.7%, snapping a 3-day winning streak due to weak iron ore demand.
The materials sector could have a positive tailwind in the week, if China decides to cut rates again and help aid the sector’s recovery, according to eToro market analyst Josh Gilbert.
Among individual stocks, lithium developer Lake Resources announced a three-year delay to first production from its Kachi project in Argentina and more than doubled its cost estimate, which sent the company’s shares tumbling 20%.
New Zealand’s benchmark S&P/NZX 50 index slipped 0.4% to finish at 11,750.75 points.
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