The Australian stock market closed at its highest level in two weeks on Monday, with the S&P/ASX 200 gaining 0.4% to finish at 8,692. The benchmark index rose 35 points, extending its winning streak to three sessions, driven by strong performances in the mining and gold sectors. However, energy stocks declined sharply as crude oil prices slipped below $100 a barrel, weighing on the broader market.
Mining and Gold Stocks Lead Gains
The materials sector climbed 1.84%, while the gold sub-index surged 4.9%. Major miners BHP Group (BHP) and Rio Tinto (RIO) rose 0.7% and 1.6%, respectively. Gold producers also performed well, with Northern Star Resources jumping 5.5% and Evolution Mining adding 4.3%. The rally in gold stocks was supported by a weaker U.S. dollar and ongoing geopolitical uncertainties.
Energy Sector Under Pressure
The energy sector was the worst performer, dropping 2.4% to its lowest level since May 15. The decline came as crude oil prices fell, with some traders betting on progress in U.S.-Iran talks, which eased fears of a new inflation spike. Woodside Energy (WDS) lost 4.2%, while Santos (STO) slid 3.6%. The lower oil prices weighed on the near-term revenue outlook for oil and gas companies.
Financial Stocks Slip
The financial sector also edged lower, with Commonwealth Bank of Australia (CBA) dropping 0.7%. Marc Jocum, senior product and investment strategist at Global X ETFs, noted that banks may continue to diverge, facing pressure to cut costs and improve efficiency to protect earnings. The sector's performance was mixed, with some lenders underperforming amid concerns about net interest margins.
Charter Hall Raises Guidance
Charter Hall (CHC) was a standout, gaining 6.7% after raising its FY26 operating earnings per security guidance to 103 cents, up from 100 cents. The property fund manager reported year-to-date gross equity inflows of $6.5 billion. CEO David Harrison said FY26 is expected to be the strongest year of capital raising in Charter Hall's 35-year history, reflecting robust investor demand for real estate assets.
Guzman y Gomez in Focus
Guzman y Gomez (GYG) shares were in the spotlight after the chain announced Friday it would shut its Chicago locations immediately. Founder and co-CEO Steven Marks said the U.S. business required significantly more time and capital than anticipated, and sales failed to meet targets. The company is now facing a lawsuit in the U.S. from former employees who allege they were not given adequate notice before the closures. A spokesperson said the company is confident it followed the law.
Market Outlook and Inflation Data
Investors are now focused on Australia's April Consumer Price Index (CPI) data, due Wednesday at 11:30 a.m. AEST. The March CPI came in at 4.6% year-over-year, up from 3.7% in February, keeping pressure on the Reserve Bank of Australia (RBA) ahead of its June policy meeting. A higher-than-expected CPI could hit rate-sensitive sectors such as property, banks, and consumer discretionary stocks, making them vulnerable to a pullback.
Trading volumes on the local bourse remained below the 30-day average, reflecting cautious sentiment. Marc Jocum described investors as cautiously optimistic rather than outright bullish, with many waiting for clearer geopolitical signals before taking on more risk. A breakdown in Middle East talks or a rebound in oil prices could reignite inflation worries, similar to earlier this year.
New Zealand Market
New Zealand's S&P/NZX 50 edged down 0.2% to 12,970.28. Investors are looking ahead to the Reserve Bank of New Zealand meeting on Wednesday, with a Reuters poll indicating most economists expect the central bank to keep rates unchanged at 2.25%.
