CBA’s record high helps drag ASX 200 higher

Australia’s sharemarket continued its gains during Tuesday’s trading as the Commonwealth Bank soared to a new record high.

The Australia sharemarket closed at a three month high thanks to trade talks between the US and China, the Commonwealth Bank hitting a record high and the RBA minutes signalling further rate cuts are coming.

The benchmark ASX 200 index gained 52.60 points or 0.63 per cent during Tuesday’s trading to close at 8,466.70.

The broader All Ordinaries also finished heavily in the green up 53.40 points or 0.62 per cent to 8,690.90.

The Australian dollar slumped throughout the trading day, down 0.67 per cent and is now buying 64.53 US cents.

On the strongest day of trading so far in June, nine of the 11 sectors finished in the green, led by the big four banks, consumer staples and telecommunication services.

ASX jumps to three month high. Photo: Gaye Gerard / NewsWire

CBA shares closed up 1.26 per cent to $178.64, hitting a new record high on Tuesday.

The rest of the big four are also trading higher, Westpac shares rose 1.37 per cent to $32.62, NAB shares rallied 1.19 per cent to close at $38.19 and ANZ shares finished heavily in the green up 1.31 per cent to $29.36.

Telecommunications businesses were also trading higher.

Telstra shares jumped 1.04 per cent to $4.87, while REA group was up 0.35 per cent to $241.13 and Car Group closed in the green up 0.37 per cent to $35.55.

It was a mixed day for the major miners with only Fortescue metals trading higher up 0.13 per cent to $15.02. Rio Tinto shares dropped 0.66 per cent to $110.02 and BHP lagged down 0.58 per cent to $37.56.

Part of the strong day on the ASX came from the back of potential trade talks between the US and China, with Capital.com senior financial market analyst Kyle Rodda said the markets were shrugging off simmering trade tensions.

“Despite the doubling of aluminium and steel tariffs and some spicy rhetoric by the US and China about trade relations, Wall Street erased an early loss to end the session broadly higher,” he said.

Nine of the 11 sectors finished in the green. Picture: NewsWire / Max Mason-Hubers

In other positive news for the ASX, the RBA’s minutes of monetary policy was released, with CBA economist Belinda Allen saying it confirms the RBA is taking on a more dovish tone.

“A July rate cut is ‘live’ given the discussion in the minutes, together with market pricing and RBA economic forecasts conditioned on a terminal rate cut of 3.2 per cent,” she said.

“We continue to expect two more rate cuts this cycle and favour an August and September cut.”

In company news, shares in IDP Education plunged after the language testing and student placement company’s latest announcement. It says global uncertainty has seen its language test volumes fall 18 to 20 per cent while student placement volumes have slumped 28 to 30 per cent.

Treasury Wine Estates rose 0.49 per cent to $8.14 after lowering its guidance and the loss of a key distributor in the US, for its premium wine division.

Shares in gambling company PointBet entered a trading halt as it waits to announce the decision of a $353m acquisition of the business by Japanese competitor MIXI.

Pizza retailer Domino’s shares were also in the red down 2.20 per cent to $21.76 after announcing leadership changes to its Japanese arm to support the “next phase of its business turnaround”.

Originally published as CBA’s record high helps drag ASX 200 higher