Australia: Shares end higher on central bank's rate-hike stance

AUSTRALIAN shares snapped a 7-session losing streak to close higher on Tuesday (Jun 21), underpinned by financials and energy stocks, as investors pushed back fears of recession after the central bank hinted at a less-aggressive policy tightening approach.

The S&P/ASX 200 index closed 1.41 per cent higher at 6,523.80, after marking their longest losing streak since March 2020 on Monday.

Reserve Bank of Australia Governor Philip Lowe played down the chance of rates being increased by a super-sized 75 basis points and took issue with market pricing of rates reaching as high as 4 per cent by year-end.

“We caution that the global experience suggests all options are on the table,” analysts at RBC Capital Markets said in a note.

Financials, which closed 2.7 per cent higher, were among the top gainers in the main index. The “Big Four” banks gained between 2.4 and 3.8 per cent.

Energy stocks jumped 2.8 per cent on strong oil prices as investor focus moved to tight supplies of crude and fuel products rather than concerns over a recession dampening demand.

Heavyweights Woodside Energy Group and Santos advanced 3.3 per cent and 1.2 per cent, respectively.

“It looks like we’ll see a ‘sympathy bounce’ for risk assets today,” said Matt Simpson, market analyst, City Index.

Global miner BHP, which operates metallurgical coal mines in Queensland, jumped 1.7 per cent after the Australian state said it would raise royalties on coal production to about A$1.2 billion (S$1.16 billion) in the 2023 financial year to capture windfall profits.

SEE ALSO

Tokyo: Nikkei bounces strongly from 3-month low as US futures gain

Hot stocks: Energy counters soar on hefty volumes over fears of tightening oil supplies

Asia: Markets climb as calm returns after sharp sell-off

Across the Tasman sea, New Zealand’s benchmark S&P/NZX 50 index closed 1.07 per cent higher at 10,701.59. REUTERS