Dec 12 Australian shares rose to their highest
level in four months on Monday, as their fifth consecutive day
of gains were underpinned by the post-U.S.-election rally and on
a surge in oil stocks after global oil producers agreed a deal
to cut crude output.
The S&P/ASX 200 index rose to its highest since
early August, up 0.4 percent, or 19.38 points, at 5,580.80 by
0107 GMT. The benchmark rallied over 2 percent last week.
Financials and industrials in the U.S. have been the biggest
beneficiaries of Republican Donald Trump's election win, with
markets betting the new administration will boost spending on
infrastructure, cut taxes and simplify regulations.
The Australian financial sector has followed suit, adding
13.2 percent since November 9 and currently hover around
The 'Big 4' Australian banks, seen as a barometer of the
sector's health, rose between 0.3 percent and 0.8 percent.
"We have seen OPEC and non-OPEC producers agreeing, which is
also boosting reflation expectation around the world," said
Chris Weston, an institutional dealer with IG Markets.
"Traders want to be hedged against this situation, so people
are buying financials globally. Everyone wants to benefit from a
reflation trade, and financials are generally your natural hedge
Energy stocks rose to their highest in 14 months
after OPEC and non-OPEC producers on Saturday reached their
first deal since 2001 to curtail oil output jointly after more
than two years of low prices.
Santos Ltd and Woodside Petroleum were up
4 percent and 3.4 percent respectively.
Origin Energy, which has significant natural gas
interests, pushed up the utilities index with a 3.1 percent
Basic materials rose on the underlying bullish market
sentiment for iron ore and steel, though the respective futures
in China edged lower on Friday on profit-taking after a six-day
Fortescue, the biggest beneficiary of the iron ore
rally, was up 2 percent. Mining majors Rio Tinto and
BHP Billiton were 0.8 percent and 1 percent higher
The gold index, however, dived 3.7 percent in light
of a higher dollar and expectations the Federal Reserve will
raise rates for the first time in 2016 at the two-day meeting
that begins on Tuesday.
New Zealand's benchmark was flat after gains in
financials stocks were offset by losses in consumer staples and
NZ-listed ANZ and Westpac shares added
over 1 percent each, while stock exchange operator NZX Ltd
rose 1 percent.
Consumer staples were pulled down by a 2 percent decline in
A2 Milk Company shares.
Industrials suffered as Air New Zealand and
Auckland International Airport lost 0.5 percent each.
(Reporting by Rushil Dutta; Additional reporting by Suhail
Hassan Bhat in Bengaluru; Editing by Shri Navaratnam)