Australia: Miners, banks help shares notch 3-1/2-month closing high

[BENGALURU] Australian shares inched higher on Thursday (Dec 30), rising for a sixth straight session to close at their highest in more than 3 and a half months in thin trading volumes, as miners and banks offset a broader sell-off.

The S&P/ASX 200 index edged up 0.05 per cent to 7,513.40, its highest close since Sep 7, and was on track to post a yearly gain of about 14 per cent. Fund manager Magellan Financial Group topped the benchmark, closing 3.7 per cent higher.

Miners were the major boost to the benchmark, rising 0.5 per cent to their highest in nearly 4 months. BHP Group and Rio Tinto jumped about 1 per cent each as iron ore futures rebounded after 3 days of losses.

However, gold stocks fell nearly 1 per cent and were the top drags, with heavyweights Newcrest Mining and Northern Star Resources declining 0.6 per cent and 1.1 per cent, respectively.

Australian gold stocks have lost about 12 per cent so far this year, heading for their first annual decline since 2013, as the metal was set for its worst performance in 6 years on rising real yields and overall US dollar strength.

However, with inflation picking up, the appeal of safe-haven assets like gold is likely to increase.

"If we are going to have long lasting inflation, you want to be in hard assets. That's commodities, that's precious metals,"said Brad Smoling, managing director at Smoling Stockbroking.

Since Australian gold miners are cheap at the moment, they will get attractive for their growth and ability to pay cash dividends going forward, Smoling said.

Elsewhere, financials ended 0.2 per cent higher, with only Australia and New Zealand Banking Group of the so called "Big Four" banks ending in negative territory while the other top 3 banks gained between 0.2 per cent and 0.4 per cent.

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index rose 0.8 per cent to 13,040.94, its highest close since Nov 9.

REUTERS