Australian shares ended higher on Tuesday as investors cheered China’s pledge to boost aid for its stuttering economy while awaiting the domestic inflation reading.

The S&P/ASX 200 index rose 0.5% to 7,339.7 points to end the trading. China’s top leaders pledged on Monday to step up policy support for the economy amid a tottering post-COVID recovery, focusing on boosting domestic demand, signalling more stimulus steps.

“There was an expectation ahead of this week’s Politburo meeting that more stimulus measures would be announced in China.

While the announced measures don’t amount to the liquidity taps being opened to full throttle, they will bring more support to consumption and the troubled property sector,“ said Tony Sycamore, market analyst at IG.

Australia’s second-quarter inflation data, due on July 26, will set the stage for the Reserve Bank of Australia’s (RBA) policy meeting next month.

Heavyweight miners led the gains on the benchmark, rising 2.9% after underlying iron-ore prices surged to a two-year high.

Mining behemoths, BHP Group, Rio Tinto and Fortescue Metals Group gained 3.3%, 3.4% and 4.6% respectively.

Energy companies followed suit to end the day 1.2% higher. Oil prices edged higher for a third straight session on Tuesday.

Sector majors Woodside Energy and Santos gained 1.2% and 0.6%.

Australian shares fall, gold and energy stocks top decliners

Gold stocks tracked the broader index to add 0.2% for the day as the bullion gained on a weaker US dollar.

Major gold miner Newcrest Mining posted a 9.1% sequential rise in output for the June quarter. Shares ended the day 0.1% higher.

Sombering the mood, banks closed 0.5% lower as investors sold off financial stocks ahead of inflation data which is expected to set the course of future rate hikes.

Tech stocks and healthcare shares ended the day 0.3% and 0.4% lower.

New Zealand’s benchmark S&P/NZX 50 index fell 0.7% to end the day at 11,933.9 points.