The Business Times

Australia: Shares gain 2% as hopes of easing Fed policy grow

Published Mon, Oct 24, 2022 · 08:54 AM

Australian shares rose nearly 2 per cent on Monday (Oct 24), buoyed by miners, as investors found comfort in Wall Street’s strong finish following a report that the US Federal Reserve will likely debate a less-aggressive interest rate hike in December.

The S&P/ASX 200 index stood at 6,805.5 points, as at 2336 GMT, with major sub-indices trading in positive territory. The benchmark was on track to post its best day since Oct 4, if gains hold.

All three major US stock indices surged more than 2 per cent, and notched their biggest Friday-to-Friday percentage gains since June, closing the book on a week marked by mixed earnings, soft economic data and political turmoil in Britain.

Some Fed officials have begun sounding out their desire to slow down the pace of rate hikes soon, according to a Wall Street Journal report.

Back home, financials added 0.8 per cent and were set to close at their highest levels in more than two months. The four largest Australian lenders advanced between 0.5 per cent and 1.2 per cent.

Miners were the lead gainers on the local bourse as they surged 4.1 per cent and were on track to record their best session since Oct 4.

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Sector heavyweights BHP Group, Rio Tinto and Fortescue Metals Group jumped between 3 per cent and 4.3 per cent.

South32 rose 2.4 per cent even as the diversified miner slashed its annual coal output forecast due to a workers’ strike over pay and an extended longwall move at its Appin mine in the Illawarra project.

Technology stocks advanced 1.9 per cent, snapping a three-day losing streak. ASX-listed Block, software maker Xero and WiseTech Global rose between 2.3 per cent and 3.5 per cent.

Higher oil prices lifted Australian energy stocks and put the sub-index on track for its highest level since February 2020. Woodside Energy and Santos added 1.2 per cent and 1 per cent, respectively.

Gold stocks climbed 4.5 per cent on strong bullion prices, with Northern Star Resources and Newcrest Mining jumping between 5.2 per cent and 5.3 per cent, respectively.

Markets in New Zealand were closed on account of a public holiday. REUTERS

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