The Australian sharemarket swelled to fresh three-month highs on Tuesday, following a positive lead from Wall Street overnight as market participants monitored United States-China trade updates.
The S&P/ASX 200 Index advanced 52.6 points or 0.6% to 8,466.7, with nine of the 11 sectors in positive territory.
Financial stocks led the gains, with major banks broadly higher - Commonwealth Bank and ANZ climbing 1.3% apiece, Westpac adding 1.4%, and National Australia Bank up 1.2%.
Rate-sensitive real estate investment trusts (A-REITs) also outperformed, bolstered by rising expectations of a 25 basis point interest rate cut by the Reserve Bank of Australia at its upcoming meeting.
As of 2 June, ASX's RBA Rate Tracker indicated a 78% probability of the cash rate being reduced to 3.60%.
Minutes from the RBA’s most recent meeting revealed policymakers considered a 50 basis point cut in May but opted for a smaller, more “predictable” 25 basis point reduction, given the heightened economic uncertainty.
On the data front, Australia’s seasonally adjusted current account deficit narrowed to $14.66 billion in the March quarter, improving from a revised $16.3 billion in the previous quarter.
However, company gross operating profits declined by 0.5%, falling well short of expectations for a 1.1% rise and significantly below the 6% growth recorded in the December quarter.
In contrast, business inventories showed unexpected strength, increasing 0.8% compared to 0.2% in the prior quarter.
In commodity markets, gold prices eased after Monday’s rally faded, though gold miners remained resilient.
Evolution Mining surged 4%, while Newmont advanced 4.3%.
Among individual stock moves, IDP Education was the worst performer, plunging 48.1% after warning that global policy uncertainty was weighing on its enrolment pipeline.
Domino’s Pizza Enterprises dropped 2.2% after announcing key leadership changes within its Japanese operations. Martin Steenks, formerly CEO of the Japan division, will transition into the role of Chief Operating Officer with immediate effect.
Asia CEO Josh Kilimnik will serve as interim chief executive for the Japan business while the company undertakes a global search for a permanent appointment.
On the bond markets, yields fell across the curve. The 10-year and 2-year Australian government bond yields dropped by 1.1% and 1.8% respectively, to 4.263% and 3.274%.
