The Australian sharemarket has rallied for a third day as investors breathed a sigh of relief following the first stage of the French election that, gleefully, failed to provide any shocks.
At the close, the benchmark S&P/ASX 200 index had advanced 17.7 points, or 0.3 per cent, to 5,871.8, while the broader All Ordinaries index had climbed 15.1 points, or 0.26 per cent, to 5,900.7.
The French election has been at the forefront of traders’ minds for much of the month, with traders gun-shy in the wake of stunning upsets in the Brexit and US election votes last year.
On this occasion the polls appear to be on the money, as the completion of the first round leaves centrist Emmanuel Macron and far-right leader Marine Le Pen to duke it out as expected.
Crucially, the results are pointing to a Macron victory when the final stage is run on May 7.
“While the increased popularity of the centrist candidate is not a strong market driver, a collective sense of relief that the global economy is over another hurdle should see a risk-on rally,” CMC Markets chief market strategist Michael McCarthy said.
The major candidates to be defeated in the first round have already lent their support to Macron, paving the way for the euro to live on.
“Consensus is that this is sufficient to sideline his far right opponent Le Pen, wiping out the prospect of a Frexit and the disintegration of the EU,” Mr McCarthy said.
“In response gold is under selling pressure and oil and copper are receiving support. These are heralds of a focus on growth-exposed assets.”
Elation in European markets may not be overwhelming tonight, however, as the strength of the euro could weigh on export-driven companies.
Closer to home, the local market appeared set for a stronger gain before a modest tapering of momentum through the afternoon.
Analysts had expected a subdued ending to the day given traders did not want to leave themselves too exposed ahead of the Anzac Day holiday.
There are also the looming inflation numbers due out Wednesday, which threaten to have a significant impact on views on likely RBA rate moves.
The resources sector largely underperformed on Monday given softness in base metals at the end of last week and a slide in iron ore futures in Asian trade.
In materials, BHP Billiton dipped 0.4 per cent to $23.94, while Fortescue slumped 2.6 per cent to $5.31 and Rio Tinto gave back 0.7 per cent to $59.82.
In energy, Santos jumped 0.8 per cent to $3.63, while Woodside lifted 0.8 per cent to $32.38.
In finance, the big four banks were all well in the black, with gains of between 0.5 and 0.9 per cent. NAB served as the positive outlier, while ANZ was the laggard.
Among other blue chips, Telstra weakened 0.5 per cent to $4.21 and Qantas added 0.8 per cent to $3.97.
Elsewhere, Village skidded 6.5 per cent on a weak trading update, while Sirtex tumbled 12.8 per cent on a disappointing clinical trial update.
Meanwhile, the Australian dollar had steadied around US75.6c at the close of local trade, consolidating a morning rise against its US counterpart.
Reader comments on this site are moderated before publication to promote lively and civil debate. We encourage your comments but submitting one does not guarantee publication. We publish hundreds of comments daily, and if a comment is rejected it is likely because it does not meet with our comment guidelines, which you can read here. No correspondence will be entered into if a comment is declined.