Australian shares climbed higher on Thursday, supported by financials and commodities, as softer-than-expected US services data and remarks from Federal Reserve Chair Jerome Powell reignited investors’ hopes for rate cuts this year.

The S&P/ASX 200 index was up 0.5% at 7,823.90, as of 0016 GMT.

The benchmark closed 1.3% lower on Wednesday.

Economic data on Wednesday showed that the US services industry growth slowed further in March, boding well for the inflation outlook.

Powell reaffirmed in a speech that the Fed will stick to its wait-and-see approach as there was time to deliberate over potential rate cuts this year, implying waiting and assessing further data points.

Rate-sensitive financials led gains in the benchmark index as they moved up 0.7%.

Australian shares fall as financials and healthcare stocks drag

The “Big Four” banks advanced between 0.6% and 1%.

Australian gold stocks were the top percentage gainers, rising 1.4% to their highest levels since May 10, as prices of the yellow metal hit record highs.

Gold miners Northern Star Resources and Evolution Mining rose 1.5% and 1.7%, respectively.

Mining stocks climbed 0.3%, tracking a rise in underlying commodity prices before the Chinese markets closed for a holiday weekend.

Mining behemoths BHP Group, Rio Tinto and Fortescue advanced between 0.1% and 0.2%.

Technology stocks tracked overnight gains on tech-heavy Nasdaq and climbed 1.4% earlier in the session.

Sub-index majors Xero and WiseTech Global advanced 2.1% and 1.7%, respectively. In company news, Suncorp Group announced the sale of its New Zealand business for NZ$410 million ($246.49 million).

Shares rose as much as 1.7% to their highest level since Dec. 17, 2007. New Zealand’s benchmark S&P/NZX 50 index edged 0.2% lower to 12,014.51.