The Australian share market finished session sharp higher on Tuesday, 16 June 2020, as risk sentiments boosted up after the Federal Reserve announcement of extraordinary measures to help support the corporate debt markets. Further boosting sentiment, minutes of the Reserve Bank of Australia's latest meeting showed that the country's economic downturn could be shallower than earlier expected.
At closing bell, the benchmark S&P/ASX200 index surged 222.47 points, or 3.89%, to 5,942.30. The broader All Ordinaries added 228.08 points, or 3.91%, to 6,058.10.
The Federal Reserve said on Monday that it would begin to buy debt issued by individual corporations based on a broad index of corporate bonds in the United States, a new step in the central bank's efforts to keep credit flowing freely amid the coronavirus pandemic. Officials voted unanimously to expand the so-called Secondary Market Corporate Credit Facility, which it unveiled in May. The program is meant to allow companies to continue borrowing money at a time of high stress on the financial system following the steep economic decline from the pandemic.
Further boosting sentiment, minutes of the Reserve Bank of Australia's latest meeting showed that the country's economic downturn could be shallower than earlier expected.
Data showing an uptick in jobs through May further cemented these hopes.
Financial stocks rose and dominated the gains. The Big Four banks firmed between 4.1% and 4.5%. Aristocrat Leisure gained 8.5%, Macquarie Group gained 6.3%.
Energy stocks gained as global oil prices improved. Fuel supplier Viva Energy soared 15.5% after it flagged better-than-expected first-half core profit and revived its share buyback programme.
ECONOMIC NEWS: Australia House Price Up 1.6%- Australia house prices were up 1.6% on quarter in the first quarter of 2020, the Australian Bureau of Statistics said on Tuesday, following the 3.9% gain in the three months prior. On a yearly basis, house prices climbed 7.4% following the 2.5% increase in the previous three months.
CURRENCY NEWS: The Australian dollar was at $0.6927 after rising from levels below $0.684 yesterday.
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