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Australian Market Rises

The Australian stock market is rising on Thursday following the positive cues overnight from Wall Street after Federal Reserve Chairman Jerome Powell's testimony before the House Financial Services Committee reignited optimism about a potential rate cut by the Fed later this month. Weakness in the banking sector was offset by gains made by mining and oil stocks.

The benchmark S&P/ASX 200 Index is adding 17.80 points or 0.27 percent to 6,707.60, after touching a high of 6,710.70 earlier. The broader All Ordinaries Index is rising 20.70 points or 0.31 percent to 6,798.40. Australian stocks eked out modest gains on Wednesday.

Among the major miners, Rio Tinto is rising 0.5 percent, BHP Group is adding 0.3 percent and Fortescue Metals is edging up 0.1 percent.

Gold miners are also higher after gold prices advanced overnight. Newcrest Mining is rising more than 2 percent and Evolution Mining is advancing 2 percent.

In the oil sector, Santos and Oil Search are higher by more than 1 percent each, while Woodside Petroleum is up 0.4 percent after crude oil prices rose to a seven-week high overnight.

Meanwhile, the big four banks - ANZ Banking, National Australia Bank, Westpac and Commonwealth Bank - are lower in a range of 0.2 percent to 1.0 percent.

The Australian Prudential Regulation Authority or APRA has ordered ANZ Banking, Westpac and National Australia Bank each to set aside a total of A$1.5 billion more in capital until they have completed refunding customers for their various wrongdoings.

Virgin Australia said that Affinity Equity Partners, the fund manager that purchased a 35 percent stake in its frequent flyer program in August 2014, is looking to sell its stake. The airline's shares are losing almost 3 percent.

In economic news, Australia will release May figures for home loans today.

In the currency market, the Australian dollar is higher against the U.S dollar on Thursday. The local currency was quoted at $0.6965, up from $0.6916 on Wednesday.

On Wall Street, stocks pulled back off best levels, but still closed higher on Wednesday. Federal Reserve Chairman Jerome Powell's prepared remarks before the House Financial Services Committee led to renewed optimism about a potential rate cut by the Fed at its next meeting later this month. Largely mirroring Powell's remarks, the minutes of the central bank's June meeting released later in the day said many participants believe the case for lowering interest rates has strengthened. However, traders seemed wary of making more substantial bets on stocks, as a rate cut would only be necessary in the face of a slowing economy.

The Dow rose 76.71 points or 0.3 percent to 26,860.20, the Nasdaq advanced 60.80 points or 0.8 percent to 8,202.53 and the S&P 500 climbed 13.44 points or 0.5 percent to 2,993.07.

The major European markets closed lower on Wednesday. While the German DAX Index fell by 0.5 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both edged down by 0.1 percent.

Crude oil prices rose to a seven-week high on Wednesday following the release of a report showing a steep drop in U.S. crude oil inventories. WTI crude for August delivery surged $2.60 or 4.5 percent to $60.43 a barrel.

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