Materials and energy sectors boost Australian shares

·3-min read

The Australian share market has finished higher thanks to energy and materials stocks.

The benchmark S&P/ASX200 index on Monday closed up 56.5 points, or 0.78 per cent, to 7276.

The broader All Ordinaries gained 59 points, or 0.8 per cent, to 7472.

The energy sector lifted the most throughout the day, outperforming the other 11 sectors by 2.48 per cent at the close.

Tribeca Alpha Plus portfolio manager Jun Bei Liu says the confidence in the sector is coming off the back of strong US payroll data released last Friday.

"Early last week, there was a lot of fear about US recession so oil prices and equities were sold off," she told AAP.

"And now on the back of the stronger payroll data, it does give investors confidence on the outlook for oil, as well as the outlook for the banking sector as well."

Woodside finished up by 2.87 per cent to $34.05, Santos by 2 per cent to $73, and Whitehaven Coal by 3.8 per cent to $70.60.

Lynas Rare Earths was the biggest winner in the materials sector following an announcement its Malaysian rare earth processing plant would be allowed to keep operating until January 1, 2024. Its original operating licence was set to expire in July.

Lynas soared 12.0 per cent to $73.70, while BHP was up 1.5 per cent to $44.72, Rio had gained 2.4 per cent to $111.96 and Fortescue gained 1.9 per cent to $20.64.

Materials finished the trading session up 1.56 per cent.

The big banks also performed well, with Westpac up by 1.83 per cent to $21.74 after lifting its dividend by 15 per cent and announcing its first-half net profit rose 22 per cent to $4 billion.

"Our first-half result reflects the progress we've made in becoming a simpler, stronger bank," said chief executive Peter King.

"Disciplined cost and margin management has lifted our return on equity and allowed us to increase dividends to 70 cents per share."

NAB was up by 1.96 per cent to $27.10 at close, CBA by 1.03 per cent to $97.12, and ANZ by 0.13 per cent to $23.83.

The overall financial sector rose by 0.73 per cent, with the other 11 sectors in the green or basically flat, besides consumer staples which was down 0.87 per cent.

The Australian dollar was buying 67.84 cents, from 67.39 US cents at Friday's ASX close.

Corpay currency strategist Peter Dragicevich says improved risk sentiment have bolstered market gains, with equities, oils and base metals performing higher on Monday.

"As a result, the Aussie dollar has ticked above its 200-day moving average while the Aussie dollar has also outperformed the euro, sterling, yen and the Chinese yuan to differing degrees," he said in a note.

Attention on Tuesday night will shift to when the government hands down the Federal Budget, with its key focus on cost of living relief.

Retail trade data and the monthly consumer confidence index will also be released on Tuesday.


* The benchmark S&P/ASX200 index on Monday closed up 56.5 points, or 0.78 per cent, to 7,276.

* The broader All Ordinaries gained 59 points, or 0.8 per cent, to 7,472.


One Australian dollar buys:

* 67.88 US cents, from 67.39 US cents at Friday's ASX close

* 91.64 Japanese yen, from 90.36 Japanese yen

* 61.50 Euro cents, from 61.07 Euro cents

* 53.69 British pence, from 53.43 British pence

* 107.22 NZ cents, from 106.87 NZ cents