The Australian share market remains at its highest level in more than 10 years as all sectors gain ground, while lingering trade tensions between the US and China continue to weigh on the Australian dollar.
The benchmark S&P/ASX200 index was up 1.1 per cent at 6,238 points at 1200 AEST on Thursday, while the broader All Ordinaries index was up one per cent at 6,337.8 points.
Consumer-related stocks are the market’s best performers, including poker machine maker Aristocrat Leisure, Flight Centre and Penfolds maker Treasury Wine Estates – all companies with significant operations overseas, and therefore an exposure to changes in exchange rates.
Rivkin Securities Investment Analyst William O’Loughlin said the only obvious catalyst for the market’s rally, which has taken the main indices to levels last seen in January 2008, is the falling Australian dollar.
“This has been particularly beneficial for ASX-listed companies with international operations as the foreign sales translate into a larger amount of Australian dollars,” he said.
The local currency was trading at 73.71 US cents at 1200 AEST, down from 73.99 US cents at the end of the local session on Wednesday, and its lowest level since May 2017.
AxiTrader chief market strategist Greg McKenna said he believes investors and traders are preparing for a drawn out battle between the US and China over tariffs, which could have an impact economic growth.
Those concerns, along with falls in commodity prices this week, are contributing the the Australian dollar’s slide, he said.
One of the few major stocks to lose ground on the share market is private hospital operator Ramsay Health Care, which was down 7.1 per cent at $57.76 after it downgraded its full year earnings guidance due to weaker growth in patient numbers and medical procedures.
The company has also warned it will take a $125 million charge on its UK operations due to onerous leases or asset writedowns.
The big four banks are all stronger, led by Commonwealth Bank’s gain of 1.4 per cent at $72.885, while BHP Billiton is the strongest of the big miners, up 1.3 per cent at $33.02.