Synopsis

Indian investors found a reason to cheer as Australian shares posted their strongest week in three, driven by a global surge in commodity and financial stocks. Softer U.S. jobs data has eased concerns about further interest rate hikes by the Federal Reserve, boosting market sentiment. Miners and banks, key components of the Australian market, led the gains, with gold stocks experiencing a significant uplift.

Australian shares logged their best week in three on Friday, with gains in miners and banks, as global risk sentiment improved after softer-than-expected U.S. jobs data eased further Federal Reserve ‌rate-hike bets.

The ⁠S&P/ASX 200 ⁠index closed 1.4% higher at 8,844.40 points, its highest closing level since June 18 and best day since June 12. For the week, the index gained 0.9%, its best since the week ended June 12.

The market, which is heavily weighted towards miners and banks, took its cue from the global rally in commodity-linked stocks and financials on the prospect of lower-for-longer borrowing costs.

"Expectations of lower U.S. interest ⁠rates are ‌generally supportive for equities, while the rise in gold and silver could provide a tailwind for Australia's major mining names," said Chris Strazzeri, financial ⁠dealing manager at Moomoo Australia and New Zealand.

Traders are now pricing in a 17.6% chance of a Fed interest rate hike in July, down from nearly 30% on Thursday.

"The broader market is likely to take confidence from the possibility of easier monetary policy ahead," said Strazzeri.

Miners led the rally, rising 2.6%, aided by higher metal prices, and finishing with their best week in over a month. Gold stocks climbed 8.3% to ‌close at their highest level in over a week. BHP Group rose 1.6%, and Mineral Resources gained 2.1%. Banks jumped 1.1% with all "Big Four" banks rising between 0.4% and 2.4%. Health stocks ⁠surged 2.7%, posting their seventh straight week of gains, with sector major CSL closing up 3.5% on Friday.

"Healthcare was battered in the last FY, and has been stabilising in the last couple of months, and investors are finally waking up to how cheap they are in a historical context," said Mark Gardner, CEO of MPC markets.

Tech stocks closed 0.3% higher while energy stocks ended flat.

Across the Tasman Sea, the New Zealand benchmark S&P/NZX 50 index rose 0.3% to 13,618.42 points.

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