Australia Market extends gains on rate cut hopes

The Australian share market were higher on Monday, 23 September 2019, on expectations of more stimulus after weak domestic jobs data last week and on hope of an interim Sino-US tariff deal after the two countries described their talks as productive" and constructive". Around late afternoon, the benchmark S&P/ASX200 index added 25.05 points, or 0.37%, to 6,755.80, while the broader All Ordinaries rose 27.34 points, or 0.4%, to 6,866.30.

Australian shares started higher on Monday on rising bets the central bank could cut interest rates as early as October after weak jobs data last week sparked expectations of more stimulus. The country's jobless rate worsened to a one-year high of 5.3% in August, data showed on Thursday, raising the probability the Reserve Bank of Australia may cut rates at its next policy meeting on Oct 1.

Also, sentiments bolstered on hope of an interim Sino-US tariff deal after the two countries described their talks as productive" and constructive". Over the weekend, the U.S. Trade Representative's office issued a brief statement characterizing the two days of talks with China as "productive." It added that a principal-level trade meeting in Washington would take place in October, as previously planned. China's Commerce Ministry, in a brief statement, described the talks as "constructive", and said they had also had a good discussion on "detailed arrangements" for the high-level talks in October. Additionally, the United States removed tariffs from more than 400 Chinese products in response to requests from U.S. companies. Despite the improved tone, markets still remain unconvinced about the possibility of deal soon.

Shares of oil companies inclined after crude oil prices surged in the morning of Asian trading hours, with international benchmark Brent crude futures gaining 1.09% to $64.98 per barrel and US crude futures jumping 1.12% to $58.74 per barrel. Australia's Beach Energy surged 2.3% and Santos gained 0.7%. Woodside Petroleum rose 1.2%.

Financials also posted gains, led by wealth manager IOOF Holdings, up 9%, after a court ruled that the country's banking watchdog had not proved its case alleging that IOOF had breached pension laws. Specialty retailer Premier Investments was up 6% after the company defied a retail downturn in the country to post a surge in annual profit.

CURRENCY NEWS: The Australian dollar was up against greenback on Monday. The Australian dollar, sensitive to shifts in broader risk appetite, changed hands at $0.6772 after declining from levels above $0.685 last week.

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