S&P Global Ratings on Friday revised Australia's sovereign rating outlook as the agency expects the federal budget balance to return to surplus by early 2020s. The credit ratings of the nation are affirmed at 'AAA' and the outlook was revised up to 'stable' from 'negative'. S&P forecasts net general government debt to peak at close to 23.3% of GDP in the fiscal year ending June 30, 2020. The headline GDP growth is seen at around 3% in fiscal 2019.
Shares in banks and financial players inclined, mirroring gains in U.S. peers, with Commonwealth Bank of Australia up 0.7%, while Westpac Banking Corp strengthened 0.3%. National Australia Bank was the only major lender in the red, down 0.3%.
Shares of materials and resources were also underpinned by a recovery in Dalian iron ore futures. Global miner BHP Billiton shares were up 2.5%, while Rio Tinto lifted 1.8% a day after it announced it would return $3.2 billion to shareholders from its sale of Australian coal assets this year, in addition to existing buyback programs. Shares in Fortescue Metals were up 4.2% and South 32 jumped 1.3% after it successfully appealed a damages decision on its Cerro Matoso nickel mine in Colombia.
CURRENCY: Australian Dollar inclined against greenback and other major currencies on Friday. The Australian dollar was buying at 72.89 US cents, from 72.57 US cents on Thursday; 82.23 Japanese yen, from 81.40; 61.88 euro cents, from 62.09; 54.97 British pence, from 55.17; and 108.97 NZ cents, from 109.13.
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