[SYDNEY] Australian shares rose on Monday (Sep 29), led by financials ahead of a widely expected hold on interest rates by the central bank, while healthcare stocks rebounded on expectations of likely exemptions from US pharmaceutical tariffs announced last week.
The S&P/ASX 200 index closed 0.9 per cent higher at 8,862.8, hitting a near two-week high and notching the third straight session of gains in its best performance since Sep 4.
Analysts broadly expect that the Reserve Bank of Australia (RBA) will keep rates unchanged at 3.6 per cent when it meets on Tuesday (Sep 30). Markets will closely parse any forward guidance after elevated monthly inflation prompted several economists to predict the current monetary easing cycle may be over.
Rate-sensitive banks led the advance with a 1.8 per cent gain in their strongest session since Sep 4, as the country’s “big four” lenders surged between 1.5 per cent and 2.5 per cent.
“Financials remain in favour with investors at present due to the safe-haven nature of returns… and as the RBA is expected to hold rates steady tomorrow,” said Grady Wulff, a senior market analyst with Bell Direct.
Healthcare stocks snapped a three-session losing streak to rise 1.4 per cent, led by a 2.4 per cent gain in CSL. The sub-index reached an intraday high not seen in more than a week as it rebounded sharply from Friday’s steep sell-off that pushed the sector to a near two-year low.
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Investors are betting CSL and other pharmaceutical companies may secure exemptions from US President Donald Trump’s 100 per cent tariffs on drug imports, given their existing US manufacturing operations.
Meanwhile, gold stocks rose 3.2 per cent to a record high, in tandem with a surge in bullion prices.
Energy firms, however, fell 0.4 per cent after oil prices declined. Whitehaven Coal and New Hope Corp led the decline, shedding 3.4 per cent and 2.7 per cent, respectively.
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In New Zealand, the benchmark S&P/NZX 50 index rose 0.2 per cent to 13,132.56. REUTERS
