Australian shares have jumped after China reported stronger-than-expected economic data – but the local bourse didn’t gain as much as other Asian indices, with investors cautious a day ahead of the federal government’s budget.
The benchmark S&P/ASX200 index closed up 36.3 points, or 0.59 per cent, to 6,217 points at 1615 AEDT on Monday, while the broader All Ordinaries was up 38 points, or 0.61 per cent, to 6,299.7.
“It’s good to see gains for the local market, but it could be doing better,” said CMC Markets chief market strategist Michael McCarthy, who noted Japan’s Nikkei index showed stronger gains and China’s Shanghai Composite was up three per cent.
“It’s a fairly soggy performance.”
The rally began after China’s Purchasing Managers’ Index (PMI) showed the country’s manufacturing sector had expanded, surprising economists.
But Australian investors only partially joined the party, with many apparently waiting on Tuesday’s budget announcement and the Reserve Bank of Australia’s board meeting, where another interest rate decision will be announced, Mr McCarthy said.
Still, it was the fifth straight day for gains for the ASX, and volume was strong for a Monday.
Consumer staples recorded the biggest gains on Monday, up collectively 1.86 per cent.
Treasurer Josh Frydenberg on Sunday said almost four million pensioners and veterans would receive a total of $285 million in cash as part of the budget that will be formally revealed on Tuesday evening.
The windfall could be good news for retailers if recipients spend their cash.
Woolworths – which announced a $1.7 billion off-market share buy-back – was up 2.24 per cent to $31.08, while supermarket rival Coles was up 1.43 per cent to $12.02.
Treasury Wine Estates, China’s top-ranked wine importer, surged 3.01 per cent to $15.38, while Bega Cheese, which also sells to China, gained 6.56 per cent to $4.87.
Miners did well on higher iron ore prices, with BHP gaining 1.45 per cent to $39.05 and Rio Tinto gaining 1.65 per cent to $99.53.
Fortescue Metals set another 10-year high, gaining 4.5 per cent to $7.43.
Afterpay Touch set another all-time high, gaining 6.87 per cent to $22.39.
All four of the big banks were up, with CBA gaining 1.02 per cent to $71.36; Westpac up one per cent to $26.18; ANZ up 0.92 per cent to $26.27; and NAB up 0.32 per cent to $25.35.
Infant formula maker Bubs was down 1.24 per cent after announcing it was acquiring Australia Deloraine Dairy.
Defensive stocks lost ground, with property trusts down 0.73 per cent and utilities down 0.65 per cent.
The Aussie dollar is buying 71.25 US cents, from 70.97 US cents on Friday.
ON THE ASX:
* The benchmark S&P/ASX200 index was up 36.3 points, or 0.59 per cent, to 6,217 points at 1630 AEDT on Monday.
* The All Ordinaries was up 38 points, or 0.61 per cent, to 6,299.7.
* At 1630 AEDT, the SPI200 futures index was up 33 points, or 0.53 per cent, to 6,204.
CURRENCY SNAPSHOT AT 1630 AEDT:
One Australian dollar buys:
* 71.25 US cents, from 70.97 US on Friday
* 79.13 Japanese yen, from 78.57
* 63.41 euro cents, from 63.19
* 54.55 British pence, from 54.30
* 104.25 NZ cents, from 104.39