ASX climbs above 9,000 after softer inflation cools rate-hike fears
Key Takeaways
- •Headline inflation slowed to 3.8% in June, below the 4% forecast, leading traders to almost rule out an August rate hike.
- •The ASX 200 rose 1.3% and reached an intraday high of 9,086.1, its highest level since before the Iran conflict began in February.
- •CSL climbed 6.6% after announcing plans for clinical trial work tied to its Horizon 2 manufacturing process, while ResMed and Ramsay Health Care also advanced.
- •Rio Tinto rose 4.7% after reporting a 43% increase in underlying first-half earnings, supported by stronger copper production.
- •Perpetual fell 1.8% after rejecting a revised takeover proposal from EQT.
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Australian shares surged on Wednesday after a softer-than-expected inflation reading sharply reduced expectations of another rate hike, pushing the benchmark above the 9,000-point mark for the first time in months. The move highlighted how closely investors are tracking the outlook for interest rates, with borrowing costs shaping everything from consumer spending to bank valuations and housing-sensitive stocks.
The ASX 200 was up 1.3 per cent after reaching an intraday high of 9,086.1, its strongest level since before the Iran conflict began in February. Headline inflation slowed to 3.8 per cent in June, below market forecasts of 4 per cent.
The result prompted traders to almost completely rule out an August rate hike, with the probability falling to just 4 per cent.
Healthcare led the rally. CSL jumped 6.6 per cent after announcing plans for clinical trial work to support its next-generation Horizon 2 manufacturing process. ResMed gained 4 per cent, while Ramsay Health Care climbed 3.3 per cent.
Consumer stocks also advanced as easing rate concerns lifted sentiment. JB Hi-Fi rose 4.2 per cent, Harvey Norman added 4.8 per cent, and Eagers gained 4.4 per cent. Coles and Woolworths both rose more than 2 per cent.
Energy shares were firmer as Brent crude rebounded 4.2 per cent to US$87.63 a barrel amid renewed fighting in the Middle East. Viva climbed 3.6 per cent and Santos added 0.8 per cent.
The banks lagged the broader market, with Commonwealth Bank slipping 0.1 per cent and Westpac down 0.3 per cent.
In company news, Rio Tinto rallied 4.7 per cent after reporting a 43 per cent increase in underlying first-half earnings, driven by stronger copper production. Mineral Resources climbed 5.3 per cent after delivering a stronger-than-expected June quarter, supported by improved lithium production and lower costs.
Woodside Energy gained 1.1 per cent after June quarter revenue jumped 35 per cent as the company tightened its full-year production guidance. Meanwhile, Perpetual slipped 1.8 per cent after rejecting a revised takeover proposal from EQT.
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