Australian Shares Hit Record High Amid US-China Trade Optimism

Australian shares surged to a new record high, driven by optimism surrounding US-China trade negotiations. The S&P/ASX200 reached a peak of 8,639, marking a significant milestone for the local market. However, as the day progressed, investors chose to lock in profits and reduce risk exposure ahead of crucial US inflation data due later.

The market closed with modest gains, with the S&P/ASX200 rising by 0.06% to 8,592.1, while the broader All Ordinaries index climbed by 0.08% to 8,819.6. The trade truce between the US and China fueled the market’s momentum, but concerns over the impact of tariffs on consumer prices loomed large.

Market strategist Jessica Amir highlighted the potential for further volatility in the coming weeks, as investors navigate uncertainties and position themselves strategically before the end of the financial year. The real estate, materials, and energy sectors led the gains, with seven out of eleven sectors ending the day on a positive note.

Financial stocks experienced a mixed day, with Commonwealth Bank and NAB dipping slightly, while Westpac and ANZ posted modest gains. Notably, Zip Co emerged as a top performer, surging over 15% on the back of its US expansion plans. Conversely, Qantas shares fell after the announcement of Jetstar Asia’s closure.

Energy stocks rallied as oil prices edged higher, boosting companies like Woodside by 1.9%. Mining giants Fortescue and BHP also saw gains, although Rio Tinto lagged behind. The gold market remained stable, with local miners experiencing varied performances.

IT stocks faced challenges, with Xero, Technology One, and Life360 registering losses. However, data center companies like Megaport and Next DC provided some relief. Prime Minister Anthony Albanese’s commitment to a housing construction plan bolstered the real estate sector, reflecting positive sentiment in the market.

The Australian dollar strengthened against the US dollar, trading at 65.13 US cents. Overall, the market displayed resilience amidst global economic uncertainties, with investors cautiously navigating market dynamics. As the financial year-end approaches, market participants are bracing for potential fluctuations before a potential rebound in July.