Aussie shares edge higher on mixed inflation figures
Australia’s stock market rose as investors acknowledged a slowing May inflation figure despite a rise in the central bank’s preferred measure.
The S&P/ASX200 index rose 30.4 points, or 0.35 percent, to 8,817.4 points at noon on Wednesday, while the broader All Ordinaries rose 30.2 points, or 0.34 percent, to 9,018.5 points.
Australia’s consumer price index fell to 4 percent on an annualized basis in May, from 4.2 percent previously, falling short of analysts’ forecasts.
The Reserve Bank of Australia’s preferred shortened average measure rose from 3.4 per cent to 3.6 per cent.
The result was an unwelcome reminder that Australia’s high inflation problem remains unresolved, setting the stage for another possible rate hike in 2026, according to Deloitte Access Economics partner Stephen Smith.
“The Central Bank will be cautious about over-interpreting a single monthly pressure, especially as the global environment remains concerning,” he said.
“While the fragile peace agreement in the Middle East is a welcome development, the disruption to global energy and logistics markets is unlikely to recover quickly.”
The heavyweight financial sector rose 0.6 per cent to six-week highs as Commonwealth Bank led its three main rivals higher.
Raw materials continued to put pressure on the stock market as metal prices continued to weaken against the rising dollar as markets braced for higher borrowing costs in the United States.
Gold miners fell for a second session, with the precious metal falling to US$4,083 ($A5,905) an ounce.
Iron ore and copper futures at major miners BHP, Rio Tinto and Fortescue also fell to 16-week and seven-week lows respectively.
Energy stocks also fell 1.2 percent, with oil prices falling to their lowest prices on March 2, two days after US-led airstrikes on Iran sparked a wider conflict and major energy shock.
All nine sectors except materials and energy were trading higher at midday, led by a strong rebound in IT stocks as WiseTech rebounded from nearly five-year lows.
Earlier this week, the stock tumbled on unofficial reports of a federal police investigation into billionaire founder and chairman Richard White. WiseTech said it was not aware of any investigation.
Xero also found some buyers after hitting a multi-year low, rising more than seven per cent on Wednesday following a positive research note from Citi and reports that Australia’s tech sector would make a comeback.
The traditionally defensive healthcare sector also demanded 2.3 percent higher wages, potentially offering value after losing nearly half its value between August and May.
Consumer staples and utilities also fared well, up more than 0.7 percent, while consumer cycles were up 0.5 percent.
Baby Bunting fell more than a tenth after lowering its 2026 profit target following a weaker-than-expected fourth quarter, according to company news.
The Australian dollar was buying 69.18 US cents at 69.53 US cents at 5pm on Tuesday.
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