Australian sharesedged higher on Wednesday as investors cheered the prospect of renewed peace talks between the U.S. and Iran, although crude supply worries lingered with the Strait of Hormuz still largely shut.
The benchmark S&P/ASX 200 index rose 0.1% to 8,978.70 points. It closed 0.5% higher on Tuesday. U.S. President Donald Trump said discussions with Iran could resume in Pakistan over the next two days, after weekend negotiations fell through and U.S. military imposed a blockade on Iranian ports. Pakistani and Iranian officials also confirmed that negotiations could restart as early as the end of this week, according to one source.
Markets tempered their optimism, however, as the Gulf’s key shipping lane remained largely closed, keeping oil supply fears squarely on the table.
“There’s clear scope for a fresh peak (for the benchmark) in the near term if diplomatic signals stay constructive,” Tim Waterer, chief market analyst at KCM Trade, said.
“Australia’s commodity leverage should make the ASX a natural beneficiary when the war premium in oil starts to fade and global risk appetite returns.”
Miners added 0.8%, closing at a one-month high with support from stronger iron ore prices on hopes that easing geopolitical tensions could revive Middle East demand for Chinese steel.
Gold stocks jumped 3.8% to a month’s high, with Northern Star Resources and Evolution Mining advancing 3% and 10%, respectively.
The technology sub-index gained 2.4%, tracking gains in U.S. technology stocks.
Meanwhile, energy stocks fell nearly 2% as oil prices turned mixed amid ongoing supply concerns linked to the closure of the Strait of Hormuz. Among individual stocks, Virgin Australia jumped 7.2% after it forecast higher fuel costs and adjusted airfares and capacity for the second half.
New Zealand’s benchmark S&P/NZX 50 index rose 0.5% to 13,076.58 points, snapping a three-day losing streak.
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