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(Australian Associated Press)
Australian shares have closed higher, buoyed by the heavyweight mining sector following improved copper and iron ore prices overnight.
The benchmark S&P/ASX200 index was up 28.5 points, or 0.46 per cent, at 6,190.0 points on Wednesday, while the broader All Ordinaries index was 27.5 points, or 0.44 per cent, higher at 6,297.0 points.
The Australian dollar rallied as investors wagered China would take steps to support domestic growth in its trade dispute with the United States.
It was buying 72.49 US cents at 1630 AEST, from 72.13 on Tuesday.
Bell Direct equities analyst Julia Lee said the tariffs on 10 per cent of the value of the goods imposed by the US on China was better than the 25 per cent many feared.
“The key thing we’ve been watching is the tariffs and they weren’t as bad as expected,” she said.
The materials sector closed 2.1 per cent higher following the anticlimactic aftermath of the trade decision.
Copper prices recorded an unexpected rise of 2.43 per cent overnight, with investors seemingly prepared for US President Donald Trump’s new tariffs on China, while iron ore jumped too as the wider market shrugged off the global trade furore.
BHP, up 2.9 per cent to $32.40, and Rio Tinto, up 3.1 per cent to $75.40, led the way for the sector.
Ms Lee said the strengthening Australian dollar was inviting for international buyers to invest in local shares.
This helped the financial sector rise 0.7 per cent, with Westpac recording the strongest gain, up 1.1 per cent to $28.20, while Commonwealth Bank had the weakest gain, up 0.24 per cent to $72.09.
This had the opposite effect, however, on company’s relying on exports, such as health care giant CSL, which closed 1.4 per cent lower at $202.49.
The telecommunications sector closed 1.5 per cent lower with TPG down 5.4 per cent to $8.25.
A number of brokers downgraded the telco’s 12 month target price after it reported disappointing results on Tuesday, Ms Lee said.
ON THE ASX:
* The S&P/ASX200 closed up 28.5 points, or 0.46 per cent, at 6,190.0 points
* The All Ordinaries was 27.5 points, or 0.44 per cent, higher at 6,297.0 points
* In futures trading the SPI200 futures index was up 22 points, or 0.36 per cent, at 6,189.0 points at 1630 AEST
CURRENCY SNAPSHOT AT 1630 AEST:
One Australian dollar buys:
* 72.49 US cents, from 72.13 US cents on Tuesday.
* 81.45 Japanese yen, from 80.98
* 62.05 euro cents, from 61.62
* 55.09 British pence, from 54.82
* 109.75 NZ cents, from 109.31
The spot price of gold in Sydney at 1630 AEST was $US1,202.83 per fine ounce, from $US1,199.46 on Tuesday.