Australian shares hit over 7-week high as banks, energy stocks gain; Coles tumbles

Australian shares reached a seven-week peak on Friday, buoyed by gains in the banking and energy sectors, while supermarket giant Coles suffered a significant decline, marking its worst trading day ever due to missing revenue expectations. The S&P/ASX 200 index climbed 1.1% to 8,992.60 by 0017 GMT, marking its highest level since September 8 and signaling its strongest monthly performance in three months.

Investors were eagerly anticipating the Reserve Bank of Australia's (RBA) decision on November 3, as well as the US Federal Reserve and European Central Bank's unchanged interest rates earlier in the week. Current swaps indicate a 43% chance of a fifth rate hike next week and an 80% likelihood of a hawkish stance at the RBA's December meeting.

Coles, Australia's second-largest retailer, plummeted over 10% after reporting first-quarter revenue that barely missed analysts' estimates, setting the stage for its sharpest one-day drop on record. This decline hit the consumer staples index hard, plummeting nearly 4% and triggering its weakest session since late April. Financials, on the other hand, surged 1.3% to approach a three-month high ahead of upcoming earnings reports.

The "Big Four" banks climbed between 0.9% and 1.2%, on track for their best monthly performance since February. Energy stocks also enjoyed gains, with Santos, Woodside Energy, and Origin Energy rising between 1% and 1.9% as oil prices stayed above $100 per barrel. Miners, however, slipped 0.3% as copper prices continued their downward trend, but were poised for their first weekly gain in nine weeks.

New Zealand's S&P/NZX 50 index also saw a modest rise of 0.3% to 13,752.85, on track for its best session in over a week. New Zealand's Reserve Bank Monetary Policy Committee member Karen Silk suggested that a hawkish move in December would be warranted if inflationary pressures persisted.