Australian shares ended higher on Friday, posting their best weekly jump in more than three months, led by gains in financials after the Reserve Bank of Australia reiterated extending a supportive monetary policy for as long as needed.
The S&P/ASX 200 index ended 1.1 per cent higher at 6,840.5 and posted a weekly gain of 3.5 per cent, marking its best weekly jump since Nov. 6.
The country’s central bank in its ‘Statement on Monetary Policy’ reaffirmed that it was committed to keeping policy “highly supportive” until inflation moved into its 2-3 per cent target band, which was unlikely until 2024 at the earliest.
Speaking before a parliamentary economics committee, RBA Governor Philip Lowe also reiterated this stance, saying the cash rate will be maintained at 10 basis points “for as long as is necessary”.
“I think Philip Lowe and the Reserve Bank are doing a very good job at addressing the issues and maintaining the confidence that we are going to come out of this,” said James McGlew, executive director of corporate stockbroking at Argonaut.
As a result of the RBA’s stance, the big dividend paying stocks, particularly the banks, are getting a lot of love from investors at the moment, McGlew added.
Financials hit its highest in 11 months, with all the so-called “Big Four” banks seeing gains in the range 2 per cent to 2.2 per cent.
Technology stocks rose 2.4 per cent, tracking U.S peers, with buy-now-pay-later giant Afterpay closing at a record high.
Energy stocks also rose after oil prices jumped to a one-year high, as Santos rose 2.4 per cent, hitting its highest in over one week, and Woodside Petroleum rose 1.1 per cent.
Several major Australian companies, including Commonwealth Bank of Australia, Newcrest Mining and Macquarie Group, are expected to report their financial results in the following week.
New Zealand’s benchmark S&P/NZX 50 index rose 0.48 per cent to 13,053.87, with seafood company Sanford gaining most.
Credit: Stocks-Markets-Economic Times