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Australian Market Significantly Higher

The Australian stock market is significantly higher on Wednesday, extending the gains in the previous three sessions, with the benchmark S&P/ASX 200 just below the 7,200 level, following the broadly positive cues overnight from Wall Street, driven by gains in materials and technology stocks. Traders also digested the hawkish comments made by US Fed Chair Jerome Powell on the outlook for interest rates and the economy.

Persistent inflation and aggressive rate hikes had stoked concerns about a potential recession. Powell said he is confident that the central bank can raise rates and deal with inflation without sending the economy into recession.

The Reserve Bank of Australia also revealed in the minutes of its May meeting that the central bank could further increase interest rates in June. The minutes show the cash rate could increase to 1.75 percent by the end of the year and hit 2.5 percent by the end of 2023.

The benchmark S&P/ASX 200 Index is gaining 53.70 points or 0.76 percent to 7,166.20, after touching a high of 7,199.00 earlier. The broader All Ordinaries Index is up 56.50 points or 0.77 percent to 7,407.10. Australian stocks ended modestly higher on Tuesday.

Among major miners, OZ Minerals is gaining more than 4 percent, Rio Tinto is up more than 2 percent, Fortescue Metals is adding more than 1 percent, Mineral Resources is rising 3.5 percent and BHP Group is advancing more than 3 percent.

Oil stocks are mostly lower. Woodside Petroleum is edging down 0.3 percent and Beach energy is losing more than 1 percent, while Santos is edging up 0.5 percent. Origin Energy is flat.

In the tech space, WiseTech Global and Appen are gaining more than 2 percent each, while Xero is adding almost 1 percent, Zip is up more than 1 percent and Afterpay owner Block is advancing more than 3 percent.

Among the big four banks, ANZ Banking is gaining more than 1 percent and Westpac is edging up 0.3 percent, while Commonwealth Bank and National Australia Bank are flat.

Among gold miners, Gold Road Resources and Northern Star Resources are gaining almost 1 percent each, while Newcrest Mining is edging up 0.3 percent, Resolute Mining is adding almost 2 percent and Evolution Mining is up 1.5 percent.

In the currency market, the Aussie dollar is trading at $0.704 on Wednesday.

On Wall Street, stocks stayed firm right through the day's session after opening on a positive note Tuesday morning, and closed with strong gains thanks to sustained buying at several counters. Strong retail sales and industrial production data, some upbeat earnings updates and Fed Chair Jerome Powell's positive comments about the strength of the economy helped lift sentiment.

The major averages all ended with impressive gains. The Dow ended with a gain of 431.17 points or 1.34 percent at 32,654.59. The S&P 500 settled higher by 80.84 points or 2.02 percent at 4,088.85, while the Nasdaq climbed 321.73 points or 2.76 percent to settle at 11,984.52, just a few points off the day's high.

The major European markets also moved back to the upside following some encouraging economic data from the region. The U.K.'s FTSE 100 gained 0.72 percent, Germany's DAX surged up 1.59 percent and France's CAC 40 advanced 1.3 percent.

Crude oil prices pared early gains and settled lower Tuesday, reacting to reports that the Biden administration is set to ease some of the sanctions imposed on Venezuela. West Texas Intermediate Crude oil futures for June ended lower by $1.80 or 1.6 percent at $112.40 a barrel.

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