Australia Market gains 0.48%; financials surge ahead of Royal Commission

Headline indices of the Australian financial market closed higher on Monday, 4 February 2019, ahead of the final report of the Royal Commission inquiry which exposed systemic wrongdoing in the vastly profitable sector. At closing bell, the benchmark S&P/ASX200 index added 28.37 points, or 0.48%, to 5,891.20 points, while the broader All Ordinaries index rose 27.68 points, or 0.47%, to 5,962.98 points.

Shares of major financials closed higher after recouping initial losses, ahead of the final report from the Royal Commission due later in the day. Its investigations into reports of wrongful charges and other wrongdoing led to a massive shake-up in the sector. The Royal Commission which looked into misconduct in Australia's financial sector released its final report on Monday, with 76 recommendations for practices across banking, insurance, and financial advice. ANZ climbed highest of the big four, adding 1.2% to A$25.22, followed by Westpac, up 1.2% to A$24.87 and NAB, 1% higher at A$24.03. Commonwealth Bank shares were up 0.77% despite being ordered by ASIC to provide its financial planning services for free, for now, after not doing enough to fix its fees-for-no-service issues. Macquarie Group added 0.25% to A$116.70, while insurers QBE, IAG and Suncorp each rose between 0.53 and 2.1%.

Shares of energy sector were up, with Woodside Petroleum and Santos Ltd firming 0.6 percent and 1.6 percent, respectively.

Boral shares closed at four-year low after the country's largest building materials supplier said it expected core earnings for the first half of fiscal 2019 to be slightly lower than the previous year, due to delays of major projects and infrastructure.

ECONOMIC NEWS: Australia building approvals was down a seasonally adjusted 8.4 percent on month in December, coming in at 13,995, the Australian Bureau of Statistics said on Monday, following the 9.1 percent decline in November. On a yearly basis, building approvals tumbled 22.5 percent following the 32.8 percent plummet in the previous month.

CURRENCY: Australian Dollar declined against greenback and against a basket of other peers on Monday, after dire home building data dealt another blow to the economic outlook.. The Aussie dollar was buying 72.30 US cents from 72.39 US cents on Friday; 79.36 Japanese yen, from 78.82; 63.19 euro cents, from 63.28; 55.31 British pence, from 55.26; and 104.94 NZ cents, from 104.75.

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