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The Australian sharemarket made notable strides on Monday, approaching its record closing high, thanks to robust performances from major banks and energy stocks, despite pressures from the mining sector. The S&P/ASX 200 Index edged 0.2% higher to close at 8109.9 points, just shy of its all-time closing peak of 8114 points reached at the end of July.
Banking Sector Leads the Charge
The standout performers on the ASX were the major banking stocks, which were significant contributors to the index's gains. Commonwealth Bank of Australia (ASX:CBA) surged 1.6% to a new record high of $141.77 per share. National Australia Bank (ASX:NAB) saw an increase of 1.3%, reaching $38.65, while Australia and New Zealand Banking Group (ASX:ANZ) edged up 0.9% to $30.66. Westpac Banking Corporation (ASX:WBC) climbed 1.2%, closing at $31.60.
The uplift in bank stocks was influenced by favorable signs from the US economy, particularly regarding interest rate policies. The US Federal Reserve’s preferred inflation measure, the personal consumption expenditures (PCE) price index, rose by 0.2% in July. This data, released over the weekend, bolsters the prospect of imminent rate cuts by the Fed. ANZ senior economist Tom Kenny noted that the PCE figures might enhance the Fed’s confidence in bringing inflation closer to its 2% target, potentially paving the way for rate reductions in September. The upcoming US labor data later this week will be closely monitored for further clues on monetary policy adjustments.
Mining Sector and Other Performers
Conversely, the mining sector faced headwinds. A dim economic outlook for China exerted downward pressure on iron ore prices, with futures slipping 3% to $US98 per tonne. Major miners experienced declines, with BHP Group (ASX:BHP) falling 1.1% to $40.33 and Rio Tinto (ASX:RIO) dropping 1.4% to $109.94. Weak factory activity in China and a deepening residential slump contributed to the negative sentiment.
In the communications sector, REA Group (ASX:REA) saw its share price fall 5.3% to $207.44, driven by news of its consideration of a potential bid for UK-listed Rightmove.
Gold miners also struggled, with Bellevue Gold (ASX:BGL) experiencing a 9.1% drop to $1.15, reflecting broader declines in the gold mining sector.
On a more positive note, Imugene (ASX:IMU) shares surged 9.7% to 6.8¢ following promising results from a cancer treatment trial. Business services provider Smartgroup (ASX:SIQ) emerged as the top performer on the index, with shares rising 5.4% to $8.44 after a favorable rating from a broker.
Star Entertainment Suspended
In a significant development, shares in Star Entertainment Group (ASX:SGR) were suspended from trading following the company’s failure to release its full-year results last week. The suspension comes amid efforts by the casino operator to stabilize its balance sheet and address the repercussions of a critical review of its operations.
The ASX approached record levels, sector-specific challenges and corporate developments shaped the day’s trading activity, highlighting the dynamic nature of the Australian financial market.
