The Australian share market closed higher for second straight session on Thursday, 16 May 2019, as investors risk sentiments underpinned on growing hopes for a central bank rate cut after weaker than expected local jobs data. At closing bell, the benchmark S&P/ASX200 index rose 43.63 points, or 0.69%, at 6,327.84 points, while the broader All Ordinaries added 46.60 points, or 0.73%, at 6,417.50.
The local market extended yesterday gains after data showed wage growth stagnating last quarter, fuelling market expectations that the Reserve Bank of Australia (RBA) would cut interest rates soon. The RBA pinned its hopes on a robust labour market to lend support for a cooling economy. Markets took signs of labour market weakness as an argument for rate cuts. The April jobs report showed that unemployment rate crept to 5.2% from 5.0%. It was expected to have ticked up to 5.1%.
Miners also rose, boosted by gold stocks. Top gold miner Newcrest Mining rose 1% while Northern Star Resources gained 1.1% . Fortescue Metals Group rose 3.2% after a lacklustre performance in the previous session.
NAB closed 0.3% lower at A$24.20 while Westpac fell 3.9% to A$25.85 as it traded ex-dividend, falling 3.9% to A$25.85.
Xero rose 10.8% to A$60.15 on Thursday after reporting it was edging closer to achieving profitability, recording positive free cash flow in 2019 and a modest net profit in the second half. The company did make a net loss for the financial year to March 31 of A$25.7 million.
Aristocrat Leisure closed 5% higher at A$26.87. In a note on Thursday, UBS analyst Matt Ryan said there would be continued near-term growth, despite its US revenue share almost doubling over the last five years. It said it was likely its growing online market share would drive share gains.
CURRENCY NEWS: The Australian dollar edged up against the U. S. dollar on Thursday, after data showed Australia's unemployment rate rose to the highest in eight months while full-time jobs fell. The data has increased the risk the Reserve Bank of Australia (RBA) will cut the cash rate in June, earlier than our call of July. The Aussie dollar skidded 0.4% to $0.6891, the weakest since early January when a currency 'flash crash' briefly sent the Aussie to $0.6743.
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