Australia: Shares hover at 5-month high; miners soar as China eases curbs

AUSTRALIAN shares inched up and hovered at a five-month high on Monday, led by sharp gains in heavyweight mining stocks, as China eased some of its strict Covid-19 rules, spurring hopes of a recovery in demand.

The S&P/ASX 200 index gained 0.3 per cent to 7,181 by 2313 GMT, their highest level since June 7. The index had ended 2.8 per cent higher on Friday.

Investor sentiment has also improved dramatically after a cooler-than-expected US inflation data last week sparked speculation that the Federal Reserve may now start easing off its aggressive tightening path.

In Sydney, miners gained as much as 4.5 per cent after iron ore and other base metals’ prices soared on China easing some of its Covid-19 rules.

Fortescue Metals Group, BHP Group and Rio Tinto gained between 4.1 per cent and 7.7 per cent. Fortescue was the second best performing stock on the benchmark.

Diversified mining services provider Perenti jumped 6.3 per cent, after the mining services provider upgraded its earnings outlook for fiscal 2023.

Energy stocks also rose 1.5 per cent after oil prices rose on health authorities in China easing some of country’s new Covid-19 curbs, raising hopes for improved demand.

Woodside Energy rose 1.3 per cent, while Santos rose 0.7 per cent.

Financials index was down 1.5 per cent, with all the “Big Four” banks losing between 0.7 per cent and 1.2 per cent. Tech stocks were up 0.3 per cent, tracking Wall Street gains, with ASX-listed shares of Block Inc up as much as 3.9 per cent.

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Elders, on the other hand, fell as much as 12.7 per cent to become the worst performing stock on the benchmark after the agribusiness firm flagged concerns about reaching full harvest potential for summer and winter crops due to extreme rainfall in the eastern states.

In New Zealand, the benchmark S$P/NZX 50 index was largely unchanged at 11,314.27. REUTERS