Australian Market Advances

The Australian stock market is advancing on Thursday following the overnight rally on Wall Street after the Federal Reserve left interest rates unchanged and reiterated its commitment to use its full range of tools to support the U.S. economy. Upbeat earnings results from miner Fortescue Metals also boosted sentiment.

The benchmark S&P/ASX 200 Index is rising 40.00 points or 0.67 percent to 6,046.40, after touching a high of 6,052.20 earlier. The broader All Ordinaries Index is adding 43.40 points or 0.71 percent to 6,171.40. Australian stocks gave up early gains to close modestly lower on Wednesday.

Among the major miners, Fortescue Metals is rising more than 2 percent, BHP Group is advancing almost 1 percent and Rio Tinto is adding 0.6 percent.

Fortescue Metals reported iron ore shipment of 178.2 million tonnes for the full year 2020, above its own upgraded forecast and also 6 percent higher than the prior year. The company also forecast shipments of 175 million tonnes to 180 million tonnes for the year ahead.

In the oil sector, Santos is higher by almost 1 percent, Oil Search is adding 0.7 percent and Woodside Petroleum is up 0.5 percent after crude oil prices rose overnight.

The big four banks - National Australia Bank, Westpac, Commonwealth Bank and ANZ Banking - are up in a range of 0.4 percent to 0.6 percent.

Ahead of the release of its full-year results in August, Commonwealth Bank has increased its estimate of the cost of compensating customers who were erroneously charged fees for the bank's financial advice by A$300 million.

Macquarie Group said its first-quarter profit is slightly lower compared to last year due to the impact of the coronavirus pandemic, but did not disclose the extent of the impact. However, the company's shares are rising more than 2 percent.

Meanwhile, gold miners are modestly lower even as gold prices rose for a ninth straight session overnight. Newcrest Mining is lower by 0.4 percent and Evolution Mining is down 0.2 percent.

On the economic front, Australia will release June data for building permits as well as second-quarter numbers for import and export prices today.

In the currency market, the Australian dollar is higher against the U.S. dollar on Thursday. The local unit was quoted at $0.7177, compared to $0.7174 on Wednesday.

On Wall Street, stocks closed higher on Wednesday with early buying interest generated as several big-name companies reported better than expected quarterly results. Stocks saw continued strength after the Federal Reserve announced its widely expected decision to leave interest rates at near-zero levels amid the economic hardship imposed by the coronavirus pandemic. The Fed also reiterated that it remains committed to using its full range of tools to support the U.S. economy in this challenging time.

The Dow climbed 160.29 points or 0.6 percent to 26,539.57, while the Nasdaq surged up 140.85 points or 1.4 percent to 10,542.94 and the S&P 500 jumped 40.00 points or 1.2 percent to 3,258.44.

The major European markets closed mixed on Wednesday. While the German DAX Index edged down by 0.1 percent, the U.K.'s FTSE 100 Index closed just above the unchanged line and the French CAC 40 Index advanced by 0.6 percent.

Crude oil prices moved higher on Wednesday after official data showed a much larger than expected decline in U.S. crude inventories in the week ended July 24. WTI crude for September added $0.23 or about 0.6 percent to $41.27 a barrel.