Australia’s share market is inching higher as investors approved a cooling May inflation figure, despite an uptick in the central bank’s preferred measure.
The S&P/ASX200 rose 30.4 points by midday on Wednesday to be up 0.35 per cent to 8,817.4, as the broader All Ordinaries gained 30.2 points, or 0.34 per cent, to 9,018.5.
Australia’s consumer price index dipped to an annualised four per cent in May, from 4.2 per cent previously, to come in below analysts’ forecasts.
The Reserve Bank of Australia’s preferred trimmed mean measure rose from 3.4 per cent to 3.6 per cent.
The outcome was an unwelcome reminder that Australia’s high inflation problem remains unsolved, setting the scene for another likely interest rate hike in 2026, according to Deloitte Access Economics partner Stephen Smith.
“The Reserve Bank will be cautious about over-interpreting a single monthly print, particularly as the global backdrop remains fraught,” 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 unwind quickly.”
The heavyweight financials sector rallied 0.6 per cent to six-week highs, as Commonwealth Bank led its main three competitors higher.
Raw materials continued to drag on the bourse, as metals prices continue fade against a rising greenback as markets brace for higher US borrowing costs.
Gold miners fell for a second session as the precious metal eased to $US4,083 ($A5,905) an ounce.
Mega miners BHP, Rio Tinto and Fortescue also dipped as iron ore and copper futures 16-week and seven-week lows, respectively.
Energy stocks also fell, down 1.2 per cent as oil prices slumped to their lowest price on March 2, two days after US-led air strikes on Iran sparked a broader conflict and major energy shock.
All nine sectors outside of materials and energy traded higher by lunchtime, led by a strong rebound in IT stocks as WiseTech bounced from nearly five-year lows.
Earlier this week, the stock tanked on unofficial reports of a federal police probe into billionaire founder and executive chair Richard White. WiseTech has said it’s not aware of any investigation.
Xero also found some buyers after hitting a multi-year low, surging more than seven per cent on Wednesday following a positive research note from Citi and reports that Australia’s tech sector is due for a comeback.
The traditionally defensive health care sector also charged 2.3 per cent higher and also potentially offering value after losing roughly half of its value between August and May.
Consumer staples and utilities also performed well, up more than 0.7 per cent each, while consumer cyclicals advanced 0.5 per cent.
In company news, Baby Bunting fell by more than a tenth after cutting its 2026 profit guidance after a weaker-than-expected fourth quarter.
The Australian dollar was buying 69.18 US cents, down from 69.53 US cents on Tuesday at 5pm.
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