Business Recorder · Markets ·
Australian shares extend early gains as May headline inflation cools
Australian shares extended early gains on Wednesday, led by financials and tech stocks after data showing headline inflation cooled in May supported sentiment even as higher-than-expected core inflation brought interest rate hikes back on the radar. The S&P/ASX 200 index rose as much as 0.4% to 8,823.2 by 0203 GMT. Before the data, the index was up 0.2%. The benchmark closed 0.3% lower on Tuesday. Australian consumer prices fell in May as fuel costs and holiday travel eased, data showed on Wednesday. However, core inflation rose 0.4%, above forecasts of 0.3%, igniting worries about further interest rate hikes. The Reserve Bank of Australia paused its tightening cycle in June after three consecutive hikes after economic growth slowed in the first quarter and unemployment ticked up in April. It had cautioned that another increase remained on the table should inflation require further restraining. On the bourse, technology stocks climbed 4%, led by a 13% charge in WiseTech Global and a 7% rise in Xero. The index fell more than 4% on Tuesday. Financials rose 0.6%, extending its gains after the inflation data. All the “Big Four” banks traded in the green. The defensive health sector added 2.3% with CSL , once Australia’s priciest stock, rising over 3%. Market participants also await employment data, due on Thursday. On the other end of the bourse, miners fell 0.7% to their lowest level in more than a week, tracking Tuesday’s fall in iron ore prices to multi-month lows on prospects of rising shipments from major suppliers and seasonally sagging steel demand. Energy stocks weakened over 1% after oil prices fell further overnight as tanker traffic through the Strait of Hormuz picked up. Woodside Energy and Santos both fell over 1.5%. In New Zealand, the benchmark S&P/NZX 50 index slipped 0.2% to 13,409.69.
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