Australian shares set for best day since mid-June as Democrats' win sparks rally

Australian shares are poised to achieve their best trading day since mid-June, following Democrats' victories in the United States midterm elections. The S&P/ASX 200 index surged 1.8% to 8,991.30 as of 01:02 GMT, on track for a record daily gain since June 12. The index had declined by 0.6% on the prior trading day. Broad-based gains were observed across all sectors, with nine out of 12 indices outperforming after global markets rallied on the expectation of reduced policy uncertainty should Democrats secure control of both chambers of Congress.

The geopolitical impact of the election also played a significant role, as hopes for a shift in policy towards reducing tensions between Iran and the United States led to a drop in oil prices by over 8%. In Sydney, miners experienced a 6.1% increase, leading to their strongest day since early April 2025, propelled by a rebound in copper and iron ore prices.

Gold stocks surged more than 9% following an overnight surge in bullion prices, driven by a weaker US dollar. Technology stocks rallied 8.2%, notably NextDC, which saw a more than 40% increase after declaring that a stake acquired by entities linked to Goodman Group and Digital Realty was opportunistic and that no takeover offer had been received.

Airlines also reaped the benefits of lower oil prices, with Qantas Airways and Virgin Australia climbing more than 4% each. Energy and financial sectors, however, lagged behind, with energy stocks falling over 5% and financials slipping 1%. National Australia Bank shares dropped as much as 7.9% following the release of a larger-than-anticipated decline in full-year cash profits due to higher credit impairment charges and expenses.

Consumer staples, consumer discretionary, real estate, and healthcare stocks, in contrast, gained between 2.1% and 2.9%. New Zealand's S&P/NZX 50 index also rose 1.9% to 14,048.39, reaching its highest level since late August.