Shares of Commonwealth Bank of Australia rose nearly 2% Monday, leading gains across the country's major lenders even as the broader share market struggled following renewed U.S. military action against Iranian targets in the Strait of Hormuz.

The stock traded at 159.90 Australian dollars, up 2.65 dollars, or 1.69%, on the Australian Securities Exchange. Commonwealth Bank's advance came alongside similar gains of between roughly 1.5% and 2.1% for the country's other major banks, including Westpac, ANZ and National Australia Bank, which together helped offset a weaker session for materials stocks and kept the benchmark ASX 200 from falling further, according to live markets coverage from ABC News.

Monday's rally in bank stocks coincided with a notable shift in interest rate expectations. Morgan Stanley said in a research note that it now expects the Reserve Bank of Australia to raise its official cash rate at its next meeting on Sept. 29, forecasting a 25-basis-point increase to 4.6%. The investment bank's Australian strategy team said stronger-than-expected July inflation data had........

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