SYDNEY: Australian stocks posted a record winning streak, with the benchmark index closing at the highest level since 2008, as investors speculate the central bank will cut interest rates again.
The S&P/ASX 200 Index rose 0.2 percent to close at 5,820.20 in Sydney, a 12th day of gains. That marks the longest rally since the index was created in 2000. The country’s shares were the world’s best performers over the 11 days through yesterday, with about A$140 billion ($109 billion) added to the value of shares over the period. The Australian Stock Exchange All Ordinaries Index, a broader gauge created in 1979, completed its longest streak of gains since a 13-day stretch in January 1986.
The Reserve Bank of Australia joined a global wave of central-bank easing this week and interbank cash-rate futures show investors anticipate at least one more cut this year. The S&P/ASX 200 has a forecast dividend yield of 4.7 percent, the highest among the world’s 12 largest equity markets and close to double the rate on the nation’s 10-year sovereign bonds.
“Today, further records will be written,” said Evan Lucas, Melbourne-based market strategist at IG Ltd., a provider of trading services in equities, currencies and commodities. “The expectation of a second rate cut is close enough to a certainty. The globe has become yield mad.”
The S&P/ASX 200 surged 9.5 percent from Jan. 20 through yesterday, the largest gain among 93 global indexes tracked by Bloomberg. Banks and mining shares contributed most to the advance.
The four largest Australian lenders — Commonwealth Bank of Australia, Australia & New Zealand Banking Group Ltd., National Australian Bank Ltd. and Westpac Banking Corp. — climbed at least 10 percent since Jan. 20. BHP Billiton Ltd. surged 14 percent over the period.
Financial firms have an average forecast payout rate of 5.1 percent, the highest among the ASX 200’s industry groups, the data show.