Shares have crept higher on the ASX by noon after federal Treasurer Josh Frydenberg delivered a budget update that showed a deficit that was not as high as the market had feared.
The S&P/ASX200 benchmark index was higher by 22.3 points, or 0.37 per cent, at 6097.4 points at 1200 AEST.
The All Ordinaries index was 24.6 points, or 0.4 per cent higher, at 6217.2.
Australia’s federal budget deficit for 2020/21 is forecast to be $184.5 billion due to a downturn in revenue and the cost of dealing with the coronavirus pandemic.
The treasurer revealed the budget was in deficit $85.8 billion in 2019/20 with the figure to blow out further in 2020/21 from record spending.
Market activity increased during the Treasurer’s address, and property shares led the gains, higher by 1.53 per cent.
There were also gains of more than 1.0 per cent for industrials and consumer discretionary stocks.
However, consumer staples and materials were trading lower.
BHP lost 0.64 per cent to $37.26, Rio slipped 1.43 per cent to $102.99 and Fortescue dropped 1.34 per cent to $16.20.
BlueScope Steel bucked the trend and was higher by 2.77 per cent to $11.87.
Gold miners had a mixed day despite prices of the precious metal surging to a nine-year peak overnight.
Newcrest gained 1.83 per cent to $34.75 after reporting higher gold and copper production in its quarterly update. Smaller rival Northern Star posted good production numbers but investors chose to sell the stock, which was down 0.31 per cent to $15.88. Evolution Mining shares slipped 1.86 per cent to $6.32.
Energy stocks were trading higher. Shares in Santos were up by 3.1 per cent to $5.63 after the oil and gas producer said production from its core assets is expected to remain steady in the near term.
The four major banks were mixed. ANZ dropped 0.11 per cent to $18.59, the Commonwealth Bank lost 0.45 per cent to $73.80, NAB rose by 0.11 per cent to $18.13 and Westpac fell 0.19 per cent to $17.97. Retail Food Group were up 1.54 per cent to 6 cents despite the company saying its Dairy Country cheese processing factory in Victoria had closed temporarily after three workers contracted COVID1-19. The company does not expect a financial or operational impact. Overnight, US markets edged higher, helped by robust home sales data, with the three main indices see-sawing through the trading session. The Australian dollar was trading at 71.37 US cents at 1200 AEST. This was higher from 71.34 US cents at Wednesday’s close.