Latest News

Australian shares snap a five-day losing streak as Iran-Israel ceasefire lifts the sentiment

After U.S. president Donald Trump announced that Israel and Iran had agreed to a ceasefire, the Australian share market closed higher Tuesday. Financial stocks led the rally.

After five sessions of consecutive declines, the S&P/ASX 200 ended up 1% higher. It had its best day of trading since early May.

Trump announced late on Monday a ceasefire between Israel, Iran and possibly the end of a 12-day war. He announced the ceasefire a few hours later and asked both sides not to break it.

The Australian market is sensitive to geopolitical events, as mining stocks have a direct impact on commodity prices. The ceasefire announcement was a catalyst to the strong recovery following a couple of disappointing sessions.

The heavyweight financial sub index closed at a record high of 1.9%. Commonwealth Bank of Australia, Australia's largest lender, closed up by 2.1% after reaching a new high.

The mining stocks gained 2%. Copper prices increased 0.4%, but iron ore prices remained stable. BHP and Rio Tinto both rose by 2.4% and 3.1% respectively.

Kim stated that financial and mining stocks offer high dividend yields, which makes them attractive. Investors are likely to also stick with sectors that focus on domestic factors such as the local monetary policies.

The Consumer Discretionary Stocks rose by 0.7%.

Oil prices dropped sharply after the Iran-Israel ceasefire, easing concerns about disruptions in supply. Sector major Woodside Energy fell 6.5%.

Virgin Australia's debut market performance saw a 11.4% increase. In response to the fall in oil prices, Qantas, a larger rival, increased 2.4%. This eased concerns about higher fuel costs.

Investors in the local market will be waiting to see Wednesday's inflation figures.

The benchmark S&P/NZX50 index in New Zealand ended the day 0.5% lower, at 12,467.48. (Reporting and editing by Vijay Kishore in Bengaluru, Nikita Maria Jio from Bengaluru)

(source: Reuters)