12.09.202507:10:15UTC+00Aussie Shares Rise on Fed Cut Optimism

The S&P/ASX 200 index rose by 0.7%, closing at 8,865 on Friday, effectively reversing the losses from the previous trading session. This positive shift was driven by gains in the financial, mining, and gold sectors, buoyed by optimism regarding potential US interest rate cuts. The advancement in global equities followed encouraging US economic data, particularly pertaining to inflation and employment, which has bolstered expectations of a Federal Reserve rate cut in the upcoming week. Nevertheless, the index recorded a 0.1% decline over the week, marking the second consecutive weekly drop. This decline was primarily influenced by uncertainties in global trade and the Reserve Bank of Australia's anticipated decision to maintain current interest rates.

Analyzing sector performance, mining stocks surged by 1.5% due to robust copper prices, with BHP and Rio Tinto increasing by 1.3% and 1.1%, respectively. The financial sector advanced by 1.2%, reaching a one-week high, as the Big Four banks each experienced over 1% gains. Meanwhile, gold stocks soared by 2.1% to hit record highs, with a notable weekly increase of 6.3%, as gold prices remained near their peak levels. Conversely, energy stocks underperformed, declining by 2.4% due to weaker oil prices amid concerns over falling US demand and an oversupply, despite ongoing geopolitical tensions in the Middle East and Ukraine.