Australia's 4-day rally is a resounding success as local inflation data are on the table
Australian shares ended a four-day streak of gains to open slightly lower on Wednesday. Losses in domestic banks slowed the gains in mining stocks. Investors awaited data on November inflation due later that day.
By 2332 GMT, the S&P/ASX 200 Index was down 0.2% to 8,268,2 points. The benchmark index ended Tuesday 0.3% higher.
According to a survey of economists, Australian markets expect a rise of 2.2% for the consumer price index for November. This is compared to the 2.1% increase in October. This will influence the outlook of interest rates by the central bank.
The Reserve Bank of Australia's (RBA) interest rates could be held steady if inflation continues to rise. They have been at 4.35% since more than a full year.
According to the RBA Watch tool, traders still believe that there is a 73% probability of a rate cut of a quarter point at the RBA’s first meeting in Febraury.
The "Big Four" local banks lost between 0.4% to 0.6%. While historically advantageous, higher rates for longer periods of time are slowing down the growth in credit and the ability of borrowers to pay their mortgages.
The domestic miners that account for nearly a quarter (25%) of the heavily resource-based bourse rose by 0.7%, ending a losing streak of three sessions. Rio Tinto BHP, and Fortescue all saw gains between 0.8% to 1.4%.
Energy companies rallied for a eleventh session in a row as oil prices rose on concerns about limited supply. The sub-index leaders Woodside Energy, and Santos, both advanced by 0.6% and 0.1% respectively.
Gold stocks rose 1.9% amid rising bullion costs and a weaker dollar. Northern Star Resources, Evolution Mining, and other miners saw their shares rise by 1.3%, 1.8% and respectively.
New Zealand's S&P/NZX 50 benchmark index fell 0.3% to 13,008.31, continuing losses for a third session. (Reporting from Nikita Marie Jino in Bengaluru, Editing by Alan Barona.)
(source: Reuters)
