Banks, tech stocks pull Aussie shares higher ahead of inflation data
AXJO hits highest daily close since February 19
Australian CPI data awaited
RBNZ expected to cut rates on Wednesday
May 27 (Reuters) - Australian shares ended at more than three-month high on Tuesday, driven by gains in financials and technology stocks, while investors awaited the release of the April inflation data, which is expected to show further moderation.
The S&P/ASX 200 index rose 0.5% to 8405.4, the highest daily close since February 19. The benchmark had ended flat on Monday.
"I think we are in a quiet period for the market in the lead up to (the) end of (the) financial year... market is bouncing around on macroeconomic news, which... is looking positive for equities," said Luke Winchester, portfolio manager at Merewether Capital. Australia's financial year ends on June 30.
Financials gained 1.1%, with the "Big Four" banks rising between 0.9% and 1.4%.
The banks have gained since the RBA's rate reduction in May, buoyed by expectations of lending volume growth on lower rates.
"However, the next big move in banks is almost certainly down as they have very limited room to rise further without earnings growth," said George Kurian, portfolio manager at Oracle Investment Management.
Technology stocks added 1.2%, touching the highest since February 24 earlier in the session.
The sub-index extended its gains from Monday, with WiseTech Global rising 2.5% to lead the rally a day after announcing its mega $2.1 billion takeover deal.
Dragging the index lower, miners fell 0.3% on falling iron ore prices. Real estate stocks lost 0.4%.
Investors are waiting for the Consumer Price Index (CPI) data on Wednesday to glean clues on the Reserve Bank of Australia's (RBA) next move, with analysts expecting the monthly rate to have eased to 2.3% in April from 2.4% a month ago.
The market has priced in a 67% chance of an RBA rate cut in July. 0#AUDIRPR
New Zealand's benchmark S&P/NZX 50 index closed 0.3% higher at 12,582.33 points, a day ahead of the local central bank's rate decision, where a 25-basis-point cut is expected, a Reuters poll showed. (Reporting by Rajasik Mukherjee in Bengaluru; Editing by Sumana Nandy)
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