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Cup Day rate rise as Governor Bullock debuts

The Australian dollar and bond yields slid after the Reserve Bank of Australia lifted the cash rate by 0.25% on Melbourne Cup Day, to 4.35%.

It was the first change to the official rate in five months – and the first under new governor Michele Bullock – coming after a run of stronger-than-expected inflation and retail sales reports appeared to force the RBA’s hand. But the central bank sounded more cautious about further tightening in its statement.

Somewhat counter-intuitively, the A$ fell against the US$ after the decision, down about one-quarter of a cent to US64.62 cents, along with the Australian sharemarket.

The benchmark S&P/ASX 200 (INDEXASX: XJO) index fell 20.3 points, or 0.3%, to 6977.1, at the closing bell, weighed down by financials and energy stocks. The All Ordinaries (INDEXASX: XAO) fell 0.2% to 7176.6.

The financials sector was the worst performer on the ASX, with the sector index dropping 1%. Westpac Banking Corp (ASX: WBC) slid 59 cents, or 2.7%, to $21.33, after reporting a 26% rise in full-year cash profit on Monday. ANZ Group Holdings Ltd (ASX: ANZ) fell 27 cents, or 1.1%, to $25.47; National Australia Bank Ltd (ASX: NAB) lost 30 cents, or 1%, to $29.04; and Commonwealth Bank of Australia (ASX: CBA) eased 41 cents, or 0.4%, to $100.01.

Origin Energy Ltd (ASX: ORG) gained 10 cents, or 1.2%, to $8.64 after proxy adviser Institutional Shareholder Services recommended that investors vote in favour of the Brookfield-led consortium’s $US10.5 billion ($20 billion) bid for the electricity generator.

Imugene Limited (ASX: IMU) surged 1.4 cents, or 26.9%, to 6.6 cents following positive early resus from a clinical trial of its novel cancer-killing virus Vaxinia.

Big miners defy resources weakness

Among the bulk miners, BHP Group Ltd (ASX: BHP) advanced 12 cents, or 0.3%, to $45.56; Rio Tinto Ltd (ASX: RIO) also gained 0.3%, in its case 31 cents, to $121.81; and Fortescue Metals Group Ltd (ASX: FMG) added 12 cents, or 0.6%, to $23.36.

In energy, Woodside Energy Group Ltd (ASX: WDS) slipped 21 cents, or 0.6%, to $33.54, Santos Ltd (ASX: STO) lost 6 cents, or 0.8%, to $7.33 and Brazilian-based producer Karoon Energy Ltd (ASX: KAR) retreated 4 cents, or 1.6%, to $2.40.

In coal, Whitehaven Coal Ltd (ASX: WHC) slid 21 cents, or 3%, to $6.80; New Hope Corporation Ltd (ASX: NHC) lost 9 cents, or 1.7%, to $5.24; Stanmore Resources Ltd (ASX: SMR) was down 6 cents, or 1.6%, to $3.73; and Yancoal Australia Ltd (ASX: YAL) eased 6 cents, or 1.3%, to $4.57.

Lithium producer Allkem Ltd (ASX: AKE) gave up 42 cents, or 4.4%, to $9.23; while fellow producer Pilbara Minerals Ltd (ASX: PLS) weakened 14 cents, or 3.7%, to $3.66. IGO Ltd (ASX: IGO), which mines nickel as well as lithium, was down 6 cents, or 0.6%, to $9.59; and Mineral Resources Ltd (ASX: MIN), which produces iron ore and lithium, lost 60 cents, or 1%, to $60.06.

Among the lithium project developers, Liontown Resources Ltd (ASX: LTR) shed 6.5 cents, or 3.9%, to $1.58; and US-based Piedmont Lithium Inc (ASX: PLL) lost 1.5 cents, or 3.4%, to 43 cents; but Lake Resources N.L. (ASX: LKE) jumped 1.5 cents, or 9.1%, to 18 cents, despite no news.

Minerals explorer Chalice Mining Ltd (ASX: CHN) sank 10.5 cents, or 5.5%, to $1.805 after an update on its flagship Gonneville Project seemed to remind investors that production is still a long way off. Chalice Mining said it had commenced the pre-feasibility study (PFS) for the project, and expects to complete the study in mid-2025.

Streaks continue for S&P 500 and Nasdaq

Overnight on Wall Street, the broad S&P 500 (INDEXSP: .INX) index and the tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC) Index both rose, marking their longest winning streaks in nearly two years.

The S&P 500 added 12.4 points, or 0.3%, to close at 4,378.38, while the Nasdaq Composite lifted 121.08 points, or 0.9%, to end at 13,639.86. The blue-chip Dow Jones Industrial Average (INDEXDJX: .DJI) advanced 56.74 points, or 0.2%, to 34,152.60.

The S&P 500 rose for a seventh consecutive day for the first time since its eight-day win streak reached in November 2021, while the Nasdaq posted eight days of wins for the first time since an 11-day streak ended in November 2021. The Dow rose for a seventh straight day, for its longest streak since July.

On the bond market, the US 10-year yield eased 8.3 basis points to 4.567%, while the 2-year yield eked out a gain of 0.4 of a basis point, to 4.928%.

Gold is down US$15.30, or 0.8%, to US$1,982.40 an ounce, while the global benchmark Brent crude oil grade plunged US$3.73, or 4.4%, to US$81.45 a barrel, and US West Texas Intermediate oil retreated US$3.68, or 4.6%, to US$77.14 a barrel.

The Australian dollar is buying 63.72 US cents this morning, down from 64.33 US cents at Tuesday’s ASX close.

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