Australian market edges towards record on rate cut hopes

Australian shares edged closer to a record high on Wednesday, driven by strong gains in real estate stocks amid increasing expectations of an interest rate cut from the Reserve Bank of Australia next month. The S&P/ASX 200 Index rose by 51.80 points to 8756.40, just below its all-time high of 8757.20, while the All Ordinaries Index posted similar gains. A softer-than-expected inflation report showed the Consumer Price Index fell to 2.1 per cent annually, prompting a decline in bond yields and the Australian dollar, and strengthening the case for monetary easing.

Real estate and banks gain, materials mixed

The rate-sensitive property sector led the rally with notable gains in Mirvac Group (ASX: MGR), Vicinity Centres (ASX: VCX), and Scentre Group (ASX: SCG). Major banks followed with Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corporation (ASX: WBC), Australia and New Zealand Banking Group Limited (ASX: ANZ), and National Australia Bank Limited (ASX: NAB) all closing higher. In contrast, the materials sector showed mixed performance amid steady iron ore futures. Fortescue Metals Group Limited (ASX: FMG) edged up, while BHP Group Limited (ASX: BHP) and Rio Tinto Limited (ASX: RIO) declined, with Rio reporting a significant earnings drop. Company-specific developments saw IGO Limited (ASX: IGO) and Appen Limited (ASX: APX) slump, while Pilbara Minerals Limited (ASX: PLS), PointsBet Holdings Limited (ASX: PBH), and PolyNovo Limited (ASX: PNV) recorded strong gains.

Global markets steady amid Fed decision and earnings

Global markets were largely steady as the S&P 500 Index dipped slightly, the Dow Jones Industrial Average fell by 171 points, and the Nasdaq Composite Index rose modestly. The US Federal Reserve kept interest rates unchanged, with dissent from some members advocating for a rate cut. Fed Chair Jerome Powell flagged uncertainty around the inflationary impact of new tariffs from President Trump, who announced fresh duties on Indian and Brazilian imports. Corporate earnings were mixed, with Humana Inc. (NYSE: HUM), Kraft Heinz Company (NASDAQ: KHC), and Visa Inc. (NYSE: V) gaining, while Starbucks Corporation (NASDAQ: SBUX)slipped despite strong revenues. Market attention shifted to post-market results from Meta Platforms Inc. (NASDAQ: META) and Microsoft Corporation (NASDAQ: MSFT).