Shares advance as retail, real estate stocks surge
The Australian share market is on track to break a three-session losing streak as interest rate-sensitive stocks rebound as the domestic monetary policy outlook softens.
The S&P/ASX200 rose 34.8 points at midday, up 0.4 per cent to 8,639 points, while the broader All Ordinaries index rose 23.9 points, or 0.27 per cent, to 8,847.4 points.
NAB economists predicted on Tuesday that the Federal Reserve’s rate hike cycle was likely complete and the next move would be cuts, although they were not sure when.
After employment and inflation figures in April came in softer than expected, the RBA is expected to keep the cash rate at 4.35 percent at its meeting next week.
“Domestic data has softened since the May meeting and while inflation remains high, the cooling in domestic economic conditions supports the idea of keeping rates steady,” Ebury economist Anthony Malouf said.
“In our view, this will enable the RBA to comfortably keep interest rates steady while it assesses the cumulative impact of the tightening cycle.”
Rate-sensitive stocks led the way, with consumer staples, discretionary stocks and real estate shares gaining between 1.4 percent and two percent, while financials and utilities gained more than 0.6 percent.
Eight out of 11 domestic sectors were trading higher at midday, while only energy, materials and IT stocks were in the red.
The drop in oil prices came despite fresh US attacks on Iran overnight after Tehran reportedly shot down an Apache helicopter.
Federal government data revealed Australia had a 43-day supply of unleaded fuel, more than double the legally established minimum and above pre-conflict levels, while diesel and jet fuel stocks were running at 36 and 30 days respectively.
JP Morgan research shows US fuel imports rose to $873 million in April, nearly quadruple their value for all of 2025.
“From a trading partner perspective, Australia-US trade flows reported the biggest bilateral gear shift,” said JP Morgan economist Tom Kennedy.
“Imports from Korea and Malaysia also increased, while products from Singapore, the largest destination in 2025, remained stable.”
Miners were in a mixed bag as gold stocks continued their decline as the precious metal fell to 11-week lows of US$4,186 ($5,959) per ounce and weakened against a strengthening greenback amid an increasingly hawkish outlook on US interest rates.
The basic materials sector was down 0.3 per cent at midday, with megaminers BHP and Rio Tinto offering limited support as recent declines in iron ore and copper futures lost momentum.
In company news, Chemist Warehouse owner Sigma Healthcare fell more than four per cent after confirming it had entered preliminary talks to buy UK beauty and pharmacy chain Boots.
Wesfarmers shares rose 2.6 per cent to $82.06 after the Bunnings owner outlined plans to use artificial intelligence to accelerate growth at strategy day.
The Australian dollar is buying 70.27 US cents at 70.58 US cents at 5pm on Tuesday.
Australia’s Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national news channel and has been providing accurate, reliable and fast-paced news content to the media industry, government and corporate sector for 85 years. We inform Australia.
