Australian shares end at 4-week high as retail sales affirm rate pause view

Mirvac

30/01/2024 05:40

* 
      Benchmark logs 7th straight session of gains
    

        * 
      Dec retail sales down 2.7%
    

        * 
      Local inflation data due Jan. 31
    

        * 
      U.S. Fed policy decision in focus
    

  
    By Roshan Thomas
       Jan 30 (Reuters) - Australian shares closed at a nearly
one-month high on Tuesday, helped by miners and healthcare
stocks, with investors rejoicing as a decline in local retail
sales affirmed a pause by the central bank in its upcoming
monetary policy meeting.
    The benchmark index S&P/ASX 200  .AXJO  rose 0.3% to 7,600.2
points, its highest closing level since Jan. 2.
    Data showed retail sales in December flipped into reverse
after rising in November, reinforcing market views that the
Reserve Bank of Australia (RBA) will not hike its key interest
rate in its meeting next week and that of a rate cut expected
later in the year.
    "Today's retail sales data backed up the view that rate cuts
were on the horizon in the middle of 2024, with sales tumbling,"
said Josh Gilbert, market analyst at brokerage eToro.
    "This is a sign the RBA wanted to see, sales weakening and
likely to show further signs of weakening in the months ahead."
    Globally, investors keenly await the outcome of the U.S.
Federal Reserve's two-day policy meeting, due late on Wednesday.
Market is widely predicting that the Fed will keep its rates
unchanged.
    "With a decent reading from GDP (gross domestic product)
last week, Jerome Powell will not be in a hurry to celebrate,
but with inflation continuing to move in the right direction, it
will be hard for the Governor to sound anything but dovish,"
Gilbert added.
    Also on investors' radar will be local inflation data due on
Wednesday, which could influence the RBA's monetary stance in
March.
    In the local bourse, miners  .AXMM  led the gains on the
benchmark, rising 0.7%.
    Healthcare sector  .AXHJ  gained 1.1% with biotech giant CSL
Ltd  CSL.AX  the top gainer, advancing 1.2%.
    Among other sectors, gold stocks  .AXGD  rose 1.5% while
technology stocks tracked their overseas peers higher, ending
the day 1.9% in the green.
    However, energy  .AXEJ  and banks  .AXFJ  both dropped 0.2%.
    The New Zealand benchmark S&P/NZX 50 index  .NZ50  ended
marginally higher at 11,914.4 points.
  

 (Reporting by Roshan Thomas and Sneha Kumar in Bengaluru;
Editing by Janane Venkatraman)
 ((Roshan.Thomas@thomsonreuters.com))
 
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