Banks, energy stocks help lift Australian shares

Australian shares closed higher on Monday, with the benchmark S&P/ASX 200 index rising 0.4% to 8,845.70 points, its highest reading since September 9. Business Recorder reported that the rally extended to a second straight session, helped by financial and energy stocks and a string of takeover deals. The index had already finished 1% higher on Friday, while a surprise drop in August employment trimmed bets on a Reserve Bank of Australia rate hike in November.

Energy shares added as much as 2.2%, reaching their best level since mid-September. New Hope climbed 6.4% after the coal miner agreed to buy unlisted Malabar Resources in a transaction worth about A$2.4 billion ($1.67 billion), while Santos and Woodside Energy added 2.3% and 2.7%.

Financials gained 0.9%, led by Challenger, which surged 19.3% to an eight-year high after receiving a takeover proposal from a unit of Daiichi Life Holdings, valuing the investment manager at about A$7.94 billion. Major banks gained between 0.7% and 1.5%. Cleanaway Waste Management jumped 20.2% on an agreed A$9.3 billion takeover by EQT, while FleetPartners rose 7.1% on an A$1.13 billion buyout by SG Fleet. Technology shares fell 1.3% in line with US counterparts, where worries about heavily indebted AI infrastructure firms weighed on sentiment.