Australia Market gains ahead of G20 Summit

Headline indices of the Australian equity market closed higher on Thursday, 27 June 2019, as investors propped up by hopes of Sino-US trade talk progress after report of tentative trade truce between the United States and China ahead of a meeting between leaders of the two nations at the G20 summit this weekend. Among ASX sub-sectors, gains by mining and oil stocks were more than offset by property trust stocks, as shares across the sector traded ex-dividend. At closing bell, the benchmark S&P/ASX200 index added 25.82 points, or 0.4%, at 6,666.30 points, while the broader All Ordinaries rose 26.87 points, or 0.4%, at 6,743.00.

Investors looked toward developments on the U.S.-China trade front, with Presidents Donald Trump and Xi Jinping set to meet at the June 28-29 G20 summit in Osaka. The two leaders are expected to discuss the protracted trade fight between their two countries. Investors are focusing on whether the two leaders can pave the way to resolve a trade dispute between the world's two biggest economies.

The potential implications of the Trump-Xi meeting for US monetary policy are huge. If the two sides agree not to impose more tariffs, the Fed would no longer need to cut rates. On the contrary, if the talks point to the imposition of more tariffs, that could nudge hesitant policymakers towards rate cuts.

U.S. President Donald Trump said on Wednesday that a trade deal with Chinese President Xi Jinping was possible this weekend and also raised a possibility that he might impose a lower tariff on a $300 billion list of Chinese imports.

Shares of materials and resources were major gainers in the benchmark indices, with Rio Tinto and BHP Group up 1.8% and 1.2%, respectively. Meanwhile, higher oil prices boosted energy stocks, with Santos higher by 0.6%, Oil Search up 0.2% and Woodside Petroleum up 0.1%

Financials were mixed, with ANZ Banking, Westpac and Commonwealth Bank were higher in a range of 0.1% to 0.2%, while National Australia Bank was lower by 0.4%.

Bubs Australia shares rocketed more than 20% Thursday after revealing it has penned a strategic partnership with China's No. 1 baby store chain, resulting in an estimated additional $6 million in sales in the first year. Bubs Organic food products are now ranged in 275 Kidswant stores in key shopping areas in 123 cities throughout China. It is estimated annual retail sales of Bubs products through the chain will reach RMB30 million ($6 million) within full fiscal year 2020.

CURRENCY NEWS: The Australian dollar edged up against the U.S. dollar on Wednesday. The Australian dollar was quoted at $0.6988, compared to $0.6975 on Wednesday.

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