The Australian stock market has pared earlier gains to close higher after the Reserve Bank of Australia (RBA) opted to keep the official cash rate on hold at its November board meeting.
At the official market close of 1615 AEDT, the benchmark S&P/ASX200 index increased 0.77% to 5,432 points, while the broader All Ordinaries index was also 0.77% higher at 5,425.7 points.
IG Markets chief market strategist Chris Weston said the local sharemarket had outperformed despite the low volume of Melbourne Cup Day trade, with the market expecting the RBA's decision not to move the official cash rate from its record low of 2.5%.
"The index has a good pedigree on Melbourne Cup Day, with traders getting into the spirit of carnival, while support for the banks is rife as traders and investors look to pick up dividend income," Mr Weston said.
"It’s also worth remembering that nineteen points come out of the index due to dividend payments on Thursday."
Financials were mixed, but the big four were in the black.
Investment bank Macquarie Group shed 0.74% to $53.50.
In insurance, IAG gained 0.82% $6.13 while Suncorp was flat at $13.30 and QBE fell 0.47% higher to $14.69.
Materials were higher across the board.
The retail sector was mostly higher.
Fairfax Media rose 2.56% to 60 cents, 21st Century Fox edged down 0.17% to $36.00 and News Corp lost 0.1% to $19.15.
Blue chip Qantas added 2.03% to $1.255, while Telstra was flat at $5.14.