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16th of July 2018

Economy



Banks push Aust shares higher

Australian shares have finished stronger, with gains in financial, energy and health care stocks outweighing losses in the mining sector.

The benchmark S&P/ASX200 index rose 32.4 points, or 0.52 per cent, to 6,210.2 points, while the broader All Ordinaries index gained 29.5 points, or 0.47 per cent, to 6,302.8 points.

CommSec market analyst Steven Daghlian said there was strong support for banking stocks, despite a sluggish start for the sector in the morning after Wall Street ended higher overnight.

"This is a sector that has been sold quite heavily for most of the year, they certainly have not been a standout part of the market," Mr Daghlian said.

"They're still down about four per cent if you look at the financial industry as a whole and that compares to the broader market, which is up about 2.5 per cent."

Commonwealth Bank rose 1.8 per cent to $73.97, National Australia Bank gained 1.2 per cent to $27.74, ANZ rose 0.9 per cent to $28.08 and Westpac added 0.7 per cent to $29.39.

Tuesday's gain was only the second in eight days on the ASX, and trading volumes were lighter than usual with some people away from work because of the school holidays, Mr Daghlian said.

The energy sector finished 0.9 per cent higher, thanks to strong gains in Caltex and Woodside Petroleum.

Bucking the broader market was the materials sector, as commodity prices fall overnight on concerns about the economic impact of China's trade dispute with the US, Shaw and Partners senior private client adviser Craig Sidney said.

Iron ore dropped 0.7 per cent, and gold and copper fell to six and seven month lows, respectively.

BHP Billiton and Rio Tinto fell 1.6 per cent to $33.05 and 3 per cent to $80.80, respectively.

Australia's central bank held the nation's official interest rate on hold at its record low of 1.5 per cent for the 23rd month in a row, as was widely expected, with few economists now tipping a rate hike before mid-2019.

The Australian dollar was broadly flat, trading at 73.73 US cents at 1630 AEST, from 73.78 US cents on Monday.

ON THE ASX:

* The benchmark S&P/ASX200 closed up 32.4 points, or 0.52 per cent, at 6,210.2 points

* The broader All Ordinaries index was up 29.5 points, or 0.47 per cent, at 6,302.8 points

* The SPI200 futures contract was up 33 points, or 0.54 per cent, at 6,170 points at 1630 AEST

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