Australian shares are set to edge fractionally higher over the rest of this year and then extend gains in 2017, driven by record-low interest rates and buttressed by recovering commodity prices, a Reuters poll of analysts and strategists found. A mooted series of US Federal Reserve interest rate hikes and a broader spike in global bond yields were cited as the biggest risks, and are expected to keep the Australian Securities Exchange's main index from breaking through the 6,000-point barrier this year and next.
The benchmark S&P/ASX 200 index has added over 3 percent this year and in July had its strongest month in almost five years as global stocks rallied after a brief spill following Britain's vote in June to leave the European Union. It is forecast to end 2016 at 5,500 points, 0.4 percent higher than Monday's closing level of 5,478.51 and nearly 4 percent higher for the year, according to the median prediction of 16 strategists polled by Reuters in the past week. The respondents' views are in line with forecasts made three months ago, although some strategists trimmed hopes for a strong performance during 2017. By end-June 2017 the index is seen steady at 5,550 points, and further up to 5,800 by end-2017. While that represents a 6 percent gain over the next 15 months, it also amounts to a sideways step from the 5,803 hit in May 2015.
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