Australian shares touch record high ahead of RBA's rate decision

Time of India

a day ago

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Australian shares edged higher and briefly touched a record high on Tuesday, led by banks and discretionary stocks , ahead of a central bank policy meeting later in the day where markets widely expect a quarter-point interest rate cut.The S&P/ASX 200 index was up 0.1% at 8,852.20, as of 0124 GMT, after touching an all-time high of 8,867.60 earlier in the session.The Reserve Bank of Australia is widely expected to slash its key cash rate by 25 basis points later in the day, a Reuters poll showed, after a benign inflation print and bleak unemployment data suggested the need for a less restrictive monetary policy.Investors will be keenly watching the decision, after the RBA left its key borrowing rate unchanged last month in a surprise decision, citing the need for more data to confirm inflation was slowing."Given the rise in the unemployment rate , core inflation nearing the midpoint of the RBA's target, and sluggish GDP growth, the case for a rate cut today is significantly stronger than the argument to keep rates on hold," IG market analyst Tony Sycamore said.Banks advanced 0.7% to a near one-week high, with all "Big Four" banks rising between 0.7% and 1.7%.The Commonwealth Bank of Australia will report its full-year results on Wednesday before the market opens. Westpac and ANZ will also announce their quarterly results later this week.Discretionary stocks rose 0.5%, led by a 5% rise in JB Hi-Fi. Star Entertainment jumped 29.2% after reaching a deal with its Hong Kong-based partners to sell its 50% stake in the A$3.6 billion ($2.35 billion) Brisbane resort.The mining index was largely flat, while gold stocks shed 0.1%. Energy stocks inched lower, while tech stocks rose 0.4%.Meanwhile, New Zealand's benchmark S&P/NZX 50 index rose 0.2% to 12,937.55. ($1 = 1.5347 Australian dollars).