ASX sets record close as banks soar

Perth Now

19 hours ago

Refreshed from the King's Birthday long weekend, the ASX 200 has surged to a new record close on Tuesday thanks to trade talks and renewed hope for a rate cut in July.
The benchmark ASX 200 index surged 71.50 points or 0.84 per cent to 8,587.20, surpassing its previous record close of 8,555.8 set back on February 14.
The broader All Ordinaries also jumped 70.80 points or 0.81 per cent to 8,812.70.
The Australian dollar slid marginally during trading, but is still buying more than 65 US cents.
On an overall strong day of trading 10 of the 11 sectors finished in the green led by the big banks, consumer discretionary and technology stocks. ASX shares soared on the back of renewed rate cut hopes. Photo: Gaye Gerard / NewsWire Credit: News Corp Australia
Zip was the best performing stock on the ASX 200 as it surged more than 6 per cent to $2.32, while Tabcorp shares jumped 5.71 per cent to $0.74 and Pilbara Minerals also jumped 5.46 per cent to $1.35.
CBA continued to retest its own record highs, jumping a further 1.17 per cent to $182 with Australia's biggest bank now having a market capitalisation of $304.10bn.
NAB shares jumped 1.53 per cent to $39.17, Westpac climbed 0.96 per cent to $33.50 and ANZ gained 1.12 per cent to $29.83.
IG Market analyst Tony Sycamore said the banks were continuing their run up from the April lows on the back of falling rates spurring on the housing and credit markets.
'If rates fall back to 3.1 per cent, which is close to where we think neutral is for the RBA, that improves affordability which adds more demand for credit for the big banks,' he said.
'What happens to their margins? I don't think there's much of a difference between 3.85 or 3.1 per cent, there's still enough fat on the bone to make their generous profits.'
The tech sector closed 1.6 per cent higher with shares in NextDC soaring 5.16 per cent to $13.86, while WiseTech Global jumped 2.36 per cent to $108.01 and Xero climbed 1.82 per cent to $192.10.
On a heavy macro economic day, there were a number of factors driving the local bourse.
In China deflation deepened to its worst level in almost two years in May, while US job figures came in hotter than expected although this was only due to the participation rate plummeting. Ten of the 11 sectors finished in the green. NewsWire / Max Mason-Hubers Credit: News Corp Australia
There were also renewed hopes of a trade talk between the US and China, although US President Donald Trump said the discussions so far had been positive but 'not easy', while Treasury Secretary Scott Bessent called it a good meeting.
Domestically, Australia's latest Westpac consumer sentiment index was released, showing Australians are feeling 'cautiously pessimistic.'
Mr Sycamore said a combination of stronger than expected international news and renewed hopes of a rate cut domestically helped spur on the local market.
'When you put the weak China number together with weak consumer confidence in Australia and dig below the surface in the US job numbers, it is probably arguing for more rate cuts from central banks, which is probably the hopeium that drives these stock markets,' he said.
'Along with hopes of trade deals, that is why we are still near a record high.'
In company news, shares in Monash IVF Group slumped 26.85 per cent to $0.545 after the fertility giant announced an embryo mix-up at its Melbourne laboratory, meaning the wrong embryo was implanted into a patient.