Australian shares mark third straight weekly gain

Australian shares posted their third consecutive weekly gain as gold and energy stocks helped markets close slightly higher yesterday amid rising fears of a global recession.

The S&P/ASX 200 index closed 0.2% higher at 7,452.2 after rising 0.6% on Thursday. It rose 1.5% this week, extending its year-to-date gain to about 5.9%, as resources stocks rallied on China demand prospects.

US data pointing to a tight labour market renewed concerns that the Federal Reserve would continue its aggressive path of interest rate hikes that could lead the country into a recession.

Comments from a few Fed officials advocating more rate hikes to bring down inflation also weighed on investor sentiment.

“Central banks are keeping conditions tight as economies slow down and that will flow into the reporting season,” said Mathan Somasundaram, chief executive officer at Deep Data Analytics.

Market participants now await the local quarterly inflation report due next Wednesday, which will likely influence the Reserve Bank of Australia’s decision at its next meeting.

Gold stocks rose 2.2% and posted their third straight weekly gain. Sector leaders Newcrest Mining and Northern Star Resources firmed 2.4% and 2.3%, respectively.

Energy stocks followed closely with a rise of 1.4%, with Woodside Energy and Santos adding 0.7% and 1.5%, respectively.

Miners gained about 1% as iron ore prices in top steel producer China advanced on higher demand. Sector majors Rio Tinto, BHP Group and Fortescue Metals climbed between 0.1% and 1%.

Mining and gold stocks have risen more than 10% since the start of the year.

Among individual stocks, Whitehaven Coal emerged as one of the top gainers on the benchmark with a 6.1% jump, after the company said it expected profit for the first half of fiscal 2023 to more than quadruple due to strong pricing.

New Zealand’s benchmark S&P/NZX 50 index rose 0.8% to 11,977.5.