Australia: Shares end higher on gold stocks boost, banks cap gains

[BENGALURU] Australian shares closed higher on Thursday (Jan 20) as upbeat results and firm bullion prices helped the gold sub-index surge 7 per cent, although the gains were capped by banks following earnings reports from their US peers.

The S&P/ASX 200 index ended 0.1 per cent higher at 7,342.40, snapping a 2-day losing streak but still hovering near a 1-month low hit in the previous session.

Gold stocks soared 7.3 per cent in their best session since April 2020, as Northern Star Resources and Resolute Mining jumped 11.4 per cent and 5.1 per cent, respectively, after robust results.

Bullion prices aided gains as they steadied near a 2-month high hit in the previous session.

Financials dropped 0.8 per cent to a near 1-month low, with top lenders Commonwealth Bank of Australia and National Australia Bank declining 0.7 per cent and 1.3 per cent, respectively.

Damian Rooney, director of equity sales at Argonaut, cited results from big US banks this week as a possible catalyst for weakness in domestic bank shares.

Local tech stocks fell 0.6 per cent, tracking their Wall Street peers lower after the tech-heavy Nasdaq entered correction territory overnight.

Altium and Computershare declined 1.6 per cent and 1.3 per cent, respectively.

Rooney attributed the slide in tech shares to markets "moving more towards a tightening cycle with Fed's minutes", with many betting on a certain interest rate hike in March.

Australia's central bank may also start raising rates as soon as August, analysts at Westpac said, as they expect a pick-up in inflation and wage growth to outweigh the drag on economic activity from rising coronavirus cases.

Meanwhile, data showed on Thursday that the country's jobless rate fell to its lowest since 2008.

In New Zealand, the benchmark S&P/NZX 50 index fell 0.9 per cent to 12,497.10.

REUTERS