Records continue to tumble as market trades beyond 7800 mark for first time

The Australian share market has traded above 7,800 points for the first time on signs that rate cuts in Europe and the United States could come sooner rather than later.

Mar 08, 2024, updated Mar 08, 2024
Digital market boards at the Australian Securities Exchange (ASX) in Sydney, Thursday, July 23, 2020. (AAP Image/James Gourley) NO ARCHIVING

Digital market boards at the Australian Securities Exchange (ASX) in Sydney, Thursday, July 23, 2020. (AAP Image/James Gourley) NO ARCHIVING

At noon AEDT on Friday, the S&P/ASX200 had risen 74.5 points, or 0.96 per cent, to 7,837.8.

With a few hours of trading left, the benchmark index was on track for a 1.2 per cent gain for the week.

The broader All Ordinaries at midday was up 72.1 points, or 0.9 per cent, to 8,098.4.

The gains came after both European Central Bank president Christine Lagarde and US Federal Reserve chairman Jerome Powell struck a more dovish stance than previously.

Ms Lagarde told reporters in Frankfurt that while the ECB couldn’t cut rates before receiving more data on wages, it would receive that information in the next few months.

“We will know a little more in April, but we will know a lot more in June,” she said.

“That was a tacit nod to a June easing, providing there are no nasty surprises in between,” NAB senior market strategist Gavin Friend wrote in a client note.

Meanwhile Mr Powell was more definitive about monetary easing before the US Senate overnight than he had been in comments to the House the previous day, telling the Senate Banking Committee that the Fed was “not far” from being able to cut rates.

The S&P500 rallied one per cent on the news and that enthusiasm carried over domestically, with the Australian market steadily gaining ground all morning.

Every sector at lunchtime was in the green except for industrials, which had dipped 0.1 per cent.

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The heavyweight financial sector was the biggest gainer, rising 1.8 per cent.

Westpac had added 2.4 per cent to a four-year high of $27.66, NAB advanced 1.8 per cent to a nine-year high of $34.93 and CBA and ANZ were both up 1.6 per cent, to an all-time high of $121.10 and a near-seven year high of $29.76.

Virgin Money UK soared 32.7 per cent to a five-year high of $4.075 after UK’s sixth-largest bank – a 2016 spinoff from NAB – tentatively agreed to be taken over by Nationwide building society for STG2.9 billion ($A5.6 billion) in a tie-up that would remove it from the ASX.

Australian shareholders would receive 2.20 pence ($4.26) per Chess Depository Interest.

The mining sector was having a quieter day, up 0.1 per cent, with BHP more or less flat, Rio Tinto down 0.2 per cent and Fortescue dipping 0.7 per cent.

The Australian dollar jumped above 66 US cents for the first time since mid-January, buying 66.15 US cents, from 65.78 cents at Wednesday’s ASX close.

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