Australia shares rise as govt paves way for billions in stimulus

Published 07/10/2020, 11:55 am
Updated 07/10/2020, 12:00 pm
© Reuters.
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* Stimulus measures to push budget deficit to record A$213.7 bln

* Gold stocks drop as bullion prices slide 1%

* U.S. President Donald Trump ends negotiations on stimulus bill

By Soumyajit Saha

Oct 7 (Reuters) - Australian shares edged higher on Wednesday, lifted mostly by tech and industrial stocks, a day after the government promised billions in the federal budget to help take the coronavirus-stricken economy out of recession.

The S&P/ASX 200 index .AXJO rose 0.25% to 5,977.2 points by 0010 GMT.

The Australian government on Tuesday announced billions in tax cuts and programmes to boost employment and infrastructure spending, measures that are set to push the budget deficit to a record A$213.7 billion ($151.73 billion) for the fiscal year ending June 30, 2021. federal budget seems to have wide support, and the market certainly took it in its stride faced with the complete economic dislocation from the virus," said James McGlew, executive director of corporate stock broking at Argonaut.

The market showed scant reaction to U.S. President Donald Trump's decision to stop negotiations with Democrats on a coronavirus economic relief bill until after the elections. sectors, tech stocks .AXIJ climbed more than 1%, with online property-related services company REA Group Ltd REA.AX gaining 1.4%.

Industrials .AXNJ were also higher, with employment-related services provider Seek Ltd SEK.AX rising 1.7% and Sydney Airport Holdings SYD.AX up 0.8%.

Gold stocks .AXGD , on the other hand, dropped about 2% as prices of bullion slid after Trump's surprise announcement.

The country's largest independent gold miner Newcrest Mining NCM.AX lost more than 1%, while explorer OceanaGold Corp OGC.AX dropped 2%.

Miners .AXMM were also trading lower, with BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX down 1.9% and 0.9%, respectively.

New Zealand's benchmark S&P/NZX 50 index .NZ50 was largely flat, as gains among financial and utility shares were pared by losses among healthcare and industrial shares.

($1 = 1.4085 Australian dollars)

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