(Corrects paragraph 2 to say S&P/ASX 200 index rose, not fell)
* Mining index closed higher at nearly 1%
* Iron ore futures set for a second consecutive weekly gain
* NZ shares fall 0.35%
Aug 18 (Reuters) – Australian shares edged higher on
Friday, led by gains in mining stocks, on renewed hopes of more
policy support from China, while global markets continued to
trade lower on concerns that the Federal Reserve will keep
interest rates higher for longer.
The S&P/ASX 200 index rose 0.03% to 7,148.1 points.
The benchmark fell 0.7% on Thursday, marking a one-month low.
Globally, investors are cautious about China’s bleak
economic outlook and the lack of urgent measures from
authorities, while fears of U.S. rates staying higher weighed on
Investors now await Fed Chair Jerome Powell’s comments on
economic outlook on Aug. 25 in Jackson Hole, Wyoming.
In Australia, miners were the top winners, ending up
nearly 1%, helped by gains in iron ore futures, as investors
breathed a sigh of relief that Chinese steel mills are yet to
cut production amid concerns about long-term demand.
“Resources are bouncing a little on higher commodity prices
and the forlorn hope that China will stimulate. The worse it
gets there, the greater the hope that authorities will do
something big,” said Henry Jennings, senior analyst and
portfolio manager at Marcustoday Financial Newsletter.
Sector majors BHP Group, Fortescue and Rio
Tinto were up between 0.9% and 1.4%.
Energy stocks closed down 0.4% despite a hike in oil
prices, which are set to snap a seven-week winning streak on
“A hawkish Fed can re-spark recession fears and press on
commodity prices and this can further weaken consumer demand and
strengthen the U.S. dollar,” said Tina Teng, analyst at CMC
The financials sub-index lost 0.5% as investors eye
Powell’s comments next week for cues on the Fed’s rate hike
trajectory. The “big four” banks were down between 0.4% and
New Zealand’s benchmark S&P/NZX 50 index slipped
0.35% to end the day at 11,611.19 points.
(Reporting by Aishwarya Nair in Bengaluru; Editing by Sonia