Australia Shares rise on easing Middle East tensions

The Australian share market finished session higher on Friday, 10 January 2020, as risk appetite remained upbeat after Wall Street shot to new highs overnight on easing of US-Iran tensions and progress in the U.S.-China trade talks. At closing bell, the benchmark S&P/ASX200 index advanced 54.80 points, or 0.8%, to 6,929.03, while the broader All Ordinaries rose by 50.48 points, or 0.72%, to 7,041.88.

The gains marked a second straight session of advances on rising confidence that the US and Iran would avoid a conflict, following statements on Wednesday by US President Donald Trump and Iranian officials. Sentiment was further boosted by China's announcement that Vice-Premier Liu He will travel to Washington next week to sign the "phase one" deal with the United States, which has lowered trade tensions between the world's two biggest economies.

Gains were rather broad based with nearly 70% (138) of the top 200 stocks in positive territory. Leading the improvements have been the healthcare, tech and consumer sectors.

The ASX's largest listed health company, CSL Ltd (CSL) continued to hit record highs with the stock lifting another 2.8%. A reportedly early start to the flu season in North America is expected to see strong demand for its flu vaccine unit.

Financials also contributed to broader lifts with the Commonwealth Bank (CBA) leading gains for the major lenders.

The fall in iron ore overnight weighed on local iron ore miners with BHP Group (BHP) down 0.3% while Fortescue Metals (FMG) ended 1.1% weaker. Gold names were also in decline with Resolute (RSG) tumbling 9%. Evolution (EVN) was down 6% after providing a production update for the December quarter. Year-to-date production for FY20 is at the bottom end of guidance with quarterly output of roughly 171koz.

CURRENCY NEWS: The Australian dollar, sensitive to shifts in broader risk appetite, fell against the U.S. dollar. The Australian dollar was at around $0.6877, continuing its slide through the week.

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