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Australia: Shares end at over 11-yr peak on rate-cut hopes, NZ at record high
[SYDNEY] Australian shares ended at their highest level in over 11 years on Thursday as expectations of local and US interest rate cuts drew investors to riskier assets.
The S&P/ASX 200 index rose 0.5 per cent or 32.50 points to 6,718.0 by the close of trade, its fourth straight session of gains and the strongest close since November 2007. The benchmark rose 0.5 per cent on Wednesday.
Disappointing economic readings in the United States reinforced views the Federal Reserve will start to cut rates as early as this month, while local stocks were cheered by increased bets for a third Australian rate cut in 2019 after May retail sales data disappointed.
Policy easing makes government debt less attractive, and drives money into higher yielding plays like equities.
Financial stocks, the largest sector in the ASX 200, closed 1 per cent higher, with most support coming from the big four banks, which ended up more than 1 per cent. Australia and New Zealand Banking Group led gains amongst its peers, adding more than 1.3 per cent for the day.
New Zealand stocks ended at a third consecutive record close, driven by the local stocks of Australian banks. The benchmark S&P/NZX 50 index rose 0.1 per cent or 13.85 points to finish the session at 10,558.28.