Australian shares scaled a near seven-year peak on Wednesday in a winning run stretching 10 straight sessions, a day after a rate cut at home stoked expectations for further monetary stimulus, while New Zealand stocks were subdued. The S&P/ASX 200 index added 69.9 points or 1.2 percent to 5,777.3, at the close of trade. It climbed as far as 5,805.1, the highest since 2008, with the benchmark up nearly 7 percent so far this year.
New Zealand's benchmark NZX 50 index was a touch firmer at 5,785.32, having added 3.3 points. The index climbed to a record high of 5,820.0 last week. "Market turnover into lunch was larger than average at A$2.181 billion. Given the huge run we have had, it would not surprise to see some selling," said Tristan K'nell, head of trading at Quay Equities. The benchmark is up nearly 7 percent since the start of 2015. The latest move up was sparked by an overnight oil price rally which helped ease deflationary fears while it boosted equities.
The index had already been underpinned by Tuesday's cut in domestic interest rates to a record low of 2.25 percent, forcing investors to search for higher-yielding assets. Gains were across all sectors with miners, the clear outperformers. Fortescue Metals leapt 9 percent, followed by BHP Billiton up 4 percent and Rio Tinto up 3 percent.
Banks extended gains, with Commonwealth Bank of Australia breaking another record high at A$91.94, the sixth time in seven sessions. Quay Equities' K'Nell warned, however, of a possible overcrowding in the sector as investors search for yield. Shares in property owner Westfield Corp jumped to their highest in 8 years after a joint venture announcement with O'Connor Capital Partners. Engineering services provider Downer EDI stocks jumped 4.8 percent following a A$1 billion locomotive maintenance agreement with Pacific National. Technology and telecommunications sectors, however, struggled with Telstra off 0.75 percent, having touched a 13-year peak of A$6.73 early in the session.
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