Australia: Shares gain as US infrastructure bill raises recovery hopes

[BENGALURU] Australian stocks rose on Friday, led by banks and mining stocks, after US President Joe Biden embracing a bipartisan Senate infrastructure deal raised hopes of a recovery in the world's largest economy.

The benchmark S&P/ASX 200 closed 0.5 per cent higher at 7,308.0, but notched its first weekly loss in six as surging Covid-19 cases in the country's most populous state, New South Wales kept markets on edge through the week.

Global stocks rallied and Wall Street set record highs overnight after Mr Biden declared "we have a deal" to renew the infrastructure of the United States.

"The infrastructure announcement means there will be a while lot of cash injection into the system. It means, there will be a strong demand for materials, and that will definitely benefit the Australian market," said Brad Smoling, managing director at Smoling stockbroking.

Domestically, miners rose 1 per cent as ironore prices gained, with BHP Group and Fortescue Metals Group rising 0.6 per cent and 0.8 per cent, respectively.

Global miner Rio Tinto recorded a 1.4 per cent weekly gain, marking its best week since early May.

Gold stocks also rose as bullion prices steadied, with Newcrest Mining gaining 1.6 per cent and marking its best session since June 11.

Financials rose 0.6 per cent, boosted by the the so-called "Big Four" banks.

Commonwealth Bank of Australia, Australia and New Zealand Banking Group, National Australia Bank and Westpac Banking rose between 0.2 per cent and 0.9 per cent.

Hurt by the surging virus cases, travel stocks such as Flight Centre Travel Group and Webjet posted weekly losses of 6.5 per cent and 4.5 per cent, respectively.

Downtown Sydney and the city's eastern suburbs, which include Bondi Beach, will go into a one week lockdown from midnight Friday.

In New Zealand, the benchmark S&P/NZX 50 index ended 0.3 per cent higher at 12,626.09. Dairy producer a2 Milk closed up 2.9 per cent and was the top gainer on the bourse.

REUTERS