The stock market in Australia closed higher on Monday, on expectations that the Reserve Bank of Australia will cut interest rates further on Tuesday. Financials led the gains in the market offsetting the declines in resource stocks. Positive closing by Wall Street on Friday, comments by Fed Chairman Ben Bernanke that the initiatives taken up to unclog the credit markets are beginning to yield positive results, and growing optimism that the downward economic momentum has slowed down, also lifted the market sentiment.
On Friday, the Dow closed up 39.51 points or 0.5% at 8,018, the Nasdaq closed up 19.24 points or 1.2% at 1,622 and the S&P 500 closed up 8.12 points or 1% at 842.
In Asian trading, crude oil gained 1.79%, or $0.94, at $53.45 a barrel in electronic trading. Light sweet crude for May delivery closed down $0.18 at $52.46 a barrel on the New York Mercantile Exchange on Friday after dismal employment report fueled concerns over energy demand.
In Sydney, the benchmark S&P/ASX 200 index gained 21 points or 0.56% to close at 3,757 and the broader All Ordinaries index added 22.40 points, or 0.61% to 3,696.
On the economic front, a report showed that the TD Securities-Melbourne Institute inflation gauge fell 0.1% in March, while the annual rate rose by 2.6%.
A survey by Australia and New Zealand Banking Group showed that the total number of job advertisements fell 8.5% in March from the month before, to average 147,804 a week.
Among banking stocks, Commonwealth Bank of Australia gained 2.11%, National Australia Bank advanced 3.33%, Westpac moved up 1.47%, and investment bank Macquarie Group rose 5.26%. However, ANZ Banking Group bucked the trend and lost 1.15%.
In the resources sector, index leader BHP Billiton lost 1.73%, and Rio Tinto fell 2.15%. Gold-related stocks ended lower following drop in gold prices. Lihir Gold dropped 6.13%, Newcrest Mining shed 5.10%, and Sino Gold fell 4.55%.
Among energy stocks, Oil Search gained 4.16%, while Woodside slipped 0.33% and Santos lost 1.09%.
Retail stocks ended mixed. While David Jones gained 2.11%, and Woolworths advanced 1.33%, Coles' owner Wesfarmers declined 1.29%.
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