Aust stocks close higher

Local market pushes higher as fears over emerging markets subside after Turkish central bank hikes lending rate.

The Australian stock market has closed 1% higher as fears around emerging markets eased following aggressive action from the central bank of Turkey to support its currency.

At the 1615 AEDT official market close, the benchmark S&P/ASX200 index rose 1.04% to 5,229 points, while the broader All Ordinaries index lifted 1.01% to 5,240.6 points.

IG market analyst Stan Shamu noted the central bank of Turkey's sharp increase in the overnight lending rate to 12%, from 7.75%.

"The emerging market story was once again the main driver of price action through Asian trade with Turkey at the forefront of market activity," Mr Shamu said.

"This [rate increase] was much more aggressive than what the market - and even the most hawkish analysts - was expecting and really showed Turkey is prepared to do whatever it takes to support its currency."

Mr Shamu said the move is aimed at stabilising the Turkish lira and keeping inflation under control.

"The local market took off this morning with the cyclical names leading the charge as investors reacted to the developments out of Turkey," he said.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles