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Australian banks lead gains for Asia equities

Wednesday 03:35 BST

What you need to know

  • Dollar hovers at 10-month low
  • Australian banks rally on capital ratio rules
  • Hong Kong stocks rise for 8th day
  • Australian dollar hits new 26-month high


Asian equities rose with Hong Kong stocks headed for an eighth consecutive day of gains, while the US dollar languished at 10-month lows after Republicans failed to push through healthcare reforms.

Hot topic

Australia’s S&P/ASX 200 was up 0.8 per cent with banks rallying after details of new capital requirements were less onerous than expected. The banking regulator said Australia’s four major banks would need to have tier 1 capital ratios of at least 10.5 per cent to meet its “unquestionably strong” benchmark, but they expect to be able to comply without raising fresh capital ANZ Bank climbed as much as 4.1 per cent while Westpac rose as much as 3.8 per cent.

In Hong Kong the Hang Seng Index was up 0.3 per cent, heading for an eighth consecutive day of gains. Cathay Pacific was the worst performing stock on the index, falling 1.6 per cent after the company’s chief executive branded the airline’s performance in the first half “disappointing”.

China’s Shanghai Composite was up 0.8 per cent while the Shenzhen Composite was up 0.3 per cent.

Japan’s Topix was up 0.1 per cent with the consumer staples sector adding 0.9 per cent while financials fell 0.4 per cent.


The dollar index, a measure of the greenback against a basket of its peers, was up 0.2 per cent after hitting a 10-month low in the previous session.

The Japanese yen was flat against the dollar at ¥112.03, hovering at a three-week high.

The Australian dollar rose 0.2 per cent against the US dollar to A$0.7930, its highest level in 26 months after rallying 1.5 per cent in the previous session following the Reserve Bank of Australia’s July minutes.

Fixed income

The 10-year US Treasury yield, which moves inversely to price, was down 4 basis points at 2.273 per cent. The yield on Australian 10-year government bonds was off 2.6 bps at 2.714 per cent.


Brent crude, the international oil benchmark, was 0.1 per cent lower at $48.80 a barrel after settling 0.8 per cent higher in the previous session amid talk that Saudi Arabia would cut exports. West Texas intermediate, the US benchmark, was down by the same amount, at $46.35 a barrel.

Gold was off 0.1 per cent at $1,241.54, but holding around two-week highs.

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