Australia: Financials and energy stocks boost shares
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AUSTRALIAN shares jumped on Friday (Oct 14) by their most in more than a week and helped the benchmark index recoup losses for the week, as heavyweight financials and energy stocks soared.
The S&P/ASX 200 index closed 1.8 per cent higher at 6,758.8, also tracking a dramatic Wall Street rebound from an initial sell-off triggered by red-hot US inflation data. The benchmark closed flat for the week after rising 4.5 per cent last week.
Data showing a bigger-than-expected rise in US consumer prices last month reinforced expectations the Federal Reserve would deliver a fourth straight 75-basis-point rate hike at its Nov 1-2 meeting.
Given the concerns about a global recession, JPMorgan market strategist Kerry Craig said the stronger US inflation number indicated that higher interest rates were not negative for the markets currently.
Talking about Australia, Craig said, “I still do believe that the Reserve Bank of Australia will push interest rates higher this year to over 3 per cent as the inflation backdrop will warrant the same.”
Leading gains on the resources-heavy Australian bourse, energy stocks advanced 3.8 per cent as oil prices reversed earlier losses on the back of a weaker US dollar and decline in diesel inventories. The sub-index, however, lost 1.5 per cent for the week.
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Woodside Energy and Santos rose 4 per cent and 4.4 per cent, respectively, on Friday.
Financials surged 1.6 per cent in their third straight sessions of gains, with the country’s “Big Four” banks adding between 0.5 and 2 per cent. The sector rose 3.1 per cent for the week.
Gold stocks, however, lost 1.3 per cent, with Newcrest Mining and Northern Star Resources shedding 1.2 per cent and 1.9 per cent, respectively. The sub-index marked its worst week in five.
New Zealand’s benchmark S&P/NZX 50 index rose 0.5 per cent to 10,868.1, but slumped 2.1 per cent for the week.
Fonterra fell 0.4 per cent after the dairy producer lowered its 2022/23 milk collection forecast for the second time in more than a month. REUTERS
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