Australian shares ended higher on Tuesday, led by gains in technology and financial stocks on hopes of the US Federal Reserve tempering down its hawkish tone, while investors awaited the country’s annual budget for cues on economic outlook.

The S&P/ASX 200 index closed 0.3% higher at 6,798.60, after ending up 1.5% on Monday. Australia’s Labor government will unveil its first budget later in the day as economic growth slows, emphasizing its spending will focus on easing the cost-of-living crisis without lighting a fire under already high inflation.

“Today’s Federal Budget should provide markets with a better idea of how the economy will look like under the new government, and what the revised borrowing program looks like,” Westpac analysts said in a note. Financials rose 1% with the “big four” banks gaining between 0.1% and 1.3%.

While there lies focus on the budget, Peter Esho, co-founder at Wealthi, said that all eyes will be on the country’s inflation print on Wednesday. “Markets are expecting the quarterly trimmed mean to rise from 4.9% to 5.6%.”

“We think the trimmed mean is showing signs that inflation expectations are gradually easing and Australia is a lot better placed relative to global peers,” he added.

Tech stocks inched 0.2% higher, tracking sharp overnight Wall Street gains, as signs economic softness suggested that the Fed’s aggressive policy is beginning to take root.

Australia-listed shares of Block Inc climbed 1.5%.

Australian shares end higher on bets of less-hawkish Fed rhetoric

However, commodity indexes across the benchmark fell.

Miners fell 1.4% as iron ore futures slumped as China’s peak steel demand season did not meet expectations.

Mining giants Rio Tinto, BHP Group and Frotescue fell between 1.4% and 3%.

Energy stocks fell 1.6% after fuel refiner Ampol missed earnings estimates, sending its shares tumbling as much as 12.2%.

New Zealand’s benchmark S&P/NZX 50 index ended the session 1.1% higher at 10,902.31.