Australia Market gains 0.5%; trade talks, Fed in focus

Headline indices of the Australia share market closed higher on Monday, 29 July 2019, as risk sentiments bolstered on tracking gains on US markets on last Friday. Market gains were, however, capped on caution ahead of the hotly anticipated US Federal Reserve meeting and to see any developments US-China trade talks this week. Most of ASX sectors inclined, with shares in financial, information technology, communications, and healthcare sectors being notable gainers, overshadowing weakness in the real estate sector. At closing bell, the benchmark S&P/ASX200 index inclined 32.41 points, or 0.48%, to 6,825.80. Meanwhile the broader All Ordinaries index, which tracks the nation's 500 biggest listed companies, rose 32.09 points, or 0.47%, to end the session at 6,911.4.

Last Friday, strong earnings and better-than-expected GDP data pushed the S&P 500 and Nasdaq Composite to record highs. The S&P 500 gained 0.7% to close at 3,025.86, while the Nasdaq Composite rose 1.1% to finish its trading day at 8,330.21. The Dow Jones Industrial Average also closed 51.47 points higher at 27,192.45.

Fed officials begin their two-day meeting on monetary policy in Washington Tuesday. Chairman Jerome Powell will hold a press conference following the FOMC's decision Wednesday. Meanwhile, Fed Chairman Jerome Powell's post-meeting press conference later in the week will provide an opportunity to gauge the trajectory of US rates after the central bank is tipped to boost stimulus.

U.S.-China trade talks are also set to resume this week, with a trade delegation from Washington scheduled to fly to China on Monday for negotiations with Beijing officials, three months after negotiations broke down. Neither side is signalling much hope for a breakthrough.

The biggest gain in the ASX200 index today was Afterpay, up 4% to A$27.18, SpeedCast International, up 3.8% to A$1.92, and Vocus Group gained 3.5% to A$3.25. The biggest decline in the ASX 200 today was Credit Corp, down 6.2% to A$24.80, after posting weaker than expected full year results. GUD Holdings dropped 4.3% to A$9.67, and Crown Resorts closed 3.3% lower at A$12.26.

CURRENCY NEWS: The Australian dollar eased against greenback on expectations of further cuts to the RBA's already record-low cash rate after Reserve Bank of Australia (RBA) governor Philip Lowe signalled that interest rates would remain low for "an extended period". The Australian dollar was changed hands at $0.6906 after slipping from levels above $0.702 last week.

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