Australian Stocks Positioned for Weekly Rise

Australia’s S&P/ASX 200 rose 35 points, or 0.4%, to close at 8,657 on Friday, extending gains for a second straight session as stronger U.S. stock futures lifted sentiment after the Dow Jones ended at a record high Thursday, with hopes for a potential easing in Middle East tensions supporting risk appetite. Local markets gained 0.3% for the week, recovering from sharp losses in the prior period, with an unexpected fall in April employment reinforcing views that the Reserve Bank could pause its tightening path after delivering three rate hikes this year. Most sectors ended higher, led by industrials, mining, and logistics. However, gains were capped by inflation concerns ahead of next week’s April CPI release. In March, figures accelerated to 4.6%, the steepest pace since September 2023, partly driven by higher fuel prices. Among top gainers were South32 Ltd. (5.1%), Evolution Mining (3.1%), and PLS Group (2.9%). The big four major lenders rose between 0.5% to 0.9%.

Australian shares rose 41 points or 0.5% to 8,662 in early Friday trade, extending gains from the prior session as U.S. futures strengthened after the Dow Jones hit a record close overnight on renewed hopes of a Washington–Tehran deal to end the Middle East conflict. Local markets are on track to log a modest weekly rise, up about 0.3% so far, after sharp declines last week, lifted by speculation that April’s surprise drop in employment could prompt the central bank to pause its tightening cycle following three hikes this year. However, strength was tempered by caution ahead of April CPI data, due next week, after March inflation surged 4.6% yoy, the fastest since September 2023, driven by higher fuel costs. Sector gains were broad, led by consumer, producer manufacturing, and logistics. The big four banks advanced between 0.4% to 1%, while standouts included BHP Group (1.1%), Evolution Mining (3.0%), SGH Ltd. (2.0%), and ALS Ltd. (1.4%).

The S&P/ASX 200 surged 125 points, or 1.5%, to 8,622 on Thursday, swinging from the prior session’s losses with broad-based gains led by electronic tech, non-energy minerals, transport, and financials. Sentiment firmed as April’s unexpected employment decline in Australia bolstered hopes that the central bank could pause its tightening cycle. Meanwhile, flash PMI showed factory activity still expanding in May despite softening from April. Wall Street’s bullish momentum on Wednesday added further support, with optimism over a potential U.S.–Iran peace deal tempering inflation and rate fears. However, caution emerged ahead of April domestic CPI due next week, after March prices surged 4.6% yoy, the fastest since September 2023, driven by higher fuel costs amid the Middle East conflict. The big four banks rose between 0.9% to 2.3%. Other notable movers were BHP Group (3.1%), Evolution Mining (3.8%), Brambles (3.5%), and Bluescope Steel Ltd. (2.3%).