Australian shares edged higher on Monday, after last week posting their first weekly loss in four, as gains in financial stocks outweighed mixed signals from Wall Street in the previous session.
- The Dow finished higher but the S&P 500 and Nasdaq ended lower
- 10-year US Treasury yields hit a three-year high
- The pan-European STOXX 600 index rose 1.3 per cent
The ASX 200 closed up 0.1 per cent at 7,485 points, while the All Ordinaries was flat at 7,773.
The Australian dollar was down at 74.3 US cents, having fallen more than 2 cents from a peak last Tuesday.
Gold stocks were the main resources companies to have a good day.
Newcrest Mining, Australia’s largest listed gold miner, rose 2.1 per cent.
Separately, Australian miner Western Areas agreed to a revised takeover offer from nickel-lithium miner IGO.
Shares of IGO and Western Areas rose 2.3 per cent and 5.5 per cent respectively.
Financials rose, lifted by gains for the big four banks.
NAB and ANZ advanced 1.5 per cent and 0.7 per cent respectively, while CBA and Westpac added 1.4 per cent and 0.6 per cent.
BlueScope Steel jumped 0.8 per cent, set for its best day in one week after signing an agreement to acquire Cornerstone Building Brand’s coil coatings business for $US500 million ($671 million).
Wall St mixed
On Wall Street, the S&P 500 and Nasdaq ended lower in choppy trades as investors assessed the economic outlook with the Fed moving to fight inflation.
Last week’s release of minutes from the Fed’s March meeting showed “many” officials were prepared to raise rates in 50-basis-point increments in coming months.
The US dollar index advanced to 100 for the first time in nearly two years.
In Treasuries, the 10-year yield hit 2.73 per cent, its highest since March 2019, and the yield on 10-year inflation-protected securities went within 15 basis points of turning positive for the first time in over two years.
The yield on 10-year Treasury notes was up 5.2 basis points to 2.706 per cent while the two-year note yield was up 5.8 basis points at 2.520 per cent, leaving the 2/10 spread at 18.41 basis points.
Australian Government 10-year bonds meanwhile passed a 3 per cent yield for the first time since July 2015, in a further sign of how far markets expect interest rates to rise from previous lows.
The Dow Jones Industrial Average rose 137.55 points, or 0.4 per cent, to 34,721.12, the S&P 500 lost 11.93 points, or 0.27 per cent, to 4,488.28 and the Nasdaq Composite dropped 186.30 points, or 1.34 per cent, to 13,711.
The pan-European STOXX 600 index rose 1.31 per cent and MSCI’s gauge of stocks across the globe shed 0.04 per cent.
French presidential election risk was also evident in bond markets as French borrowing costs rose while yields of other core European government bonds fell.
In the energy market, oil prices rose 2 per cent on Friday but registered their second straight weekly decline.
Member nations of the International Energy Agency (IEA) will release 60 million barrels over the next six months, with the United States matching that amount as part of its 180 million barrel release announced in March.
Brent crude futures were down 1.9 per cent, trading at $US100.87 a barrel, by 5:10pm AEST.