AUS
NZ
UK
CA
USA
IND
Highlights
- S&P/ASX 200 up 1%: The index reached 8,433.8, driven by financials and miners.
- Inflation Data in Focus: Investors are awaiting December and Q4 inflation figures next week for signs of interest rate direction.
- Miners and Financials Outperform: BHP, Rio Tinto, and the Big Four banks saw notable gains.
Australian shares rose sharply on Tuesday, as financials and miners led the charge, buoying the S&P/ASX 200 index to a 1% gain, closing at 8,433.8. This positive movement follows a 0.5% rise on Monday, as investors turned their attention to key economic data and global developments.
Inflation Data and Interest Rate Expectations
A key focus for the market in the coming weeks will be the inflation data for December and the fourth quarter, due next week. Market participants are looking for clues that could signal the interest rate trajectory, particularly with the Reserve Bank of Australia (RBA) set to meet on February 18. If inflation has eased in December after a drop in November, it could bolster the case for a rate cut.
Current market expectations suggest a 73% chance of a 25 basis point reduction at next month’s RBA meeting, according to the RBA watch tool.
Miners Lead the Charge
Tracking the overnight gains in iron ore prices, miners were a key driver of the rally, rising 1.1%. Major miners like BHP (ASX:BHP0, Rio Tinto (ASX:RIO), and Fortescue (ASX:FMG)saw strong performances. BHP's shares climbed 1.5%, after reporting a 17% increase in second-quarter copper output and maintaining its production guidance for fiscal 2025. Fortescue rose 1.3%, while Rio Tinto added 0.9%.
Fortescue is expected to release its second-quarter production results on Thursday, further fueling investor interest in the sector.
Strong Performance from Financials
The financials sector gained 1.7%, with the Big Four banks leading the way. Shares of Commonwealth Bank, Westpac, ANZ, and National Australia Bank rose between 1.6% and 2.8%, reflecting a broader confidence in the banking sector as a stable growth driver.
Energy Stocks Mixed
Energy stocks showed a mixed performance, with the energy sector rising 0.4% despite a slight slip in oil prices. Woodside Energy climbed 0.7%, while smaller rival Santos fell 0.8%. Both companies are set to report their fourth-quarter results later this week.
New Zealand Market Movement
Across the Tasman, New Zealand's S&P/NZX 50 index rose 0.1% to 13,099.42, reflecting a more subdued but still positive market sentiment.
