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Uncharted territory for the Australian market

The prospect of interest rate relief helped to send the Australian sharemarket to a new record, as the latest inflation figure showed that appreciation in the Consumer Price Index (CPI) cooled to a two-year low of 4.1 per cent in December.

That “print” was comfortably below the Reserve Bank of Australia’s forecasts, leading the market not only to believe that a further rate rise is now unlikely, but even to price-in two rate cuts in 2024.

That helped to push the Australian sharemarket to a new record high. The benchmark S&P/ASX 200 (INDEXASX: XJO) closed up 80.5 points, or 1.1 per cent, to 7,680.7 – 51.8 points, or 0.7 per cent, above the previous closing record of 7,628.9 points, which was reached in August 2021. The broader All Ordinaries (INDEXASX: XAO) index added 77.8 points, or 1 per cent, to 7,912.8.

Interest-rate sensitive stocks led the rally. Westpac Banking Corp (ASX: WBC) advanced 36 cents, or 1.5 per cent, to $24.18; ANZ Group Holdings Ltd (ASX: ANZ) was also 1.5 per cent to the good, up 41 cents to $27.20; and National Australia Bank Ltd (ASX: NAB) completed a trifecta of 1.5-per-cent risers, gaining 47 cents to $32.60. But Commonwealth Bank of Australia (ASX: CBA) didn’t quite get the memo, adding just 1.3 per cent, up $1.48 to $117.53.

WBC share price

Of the bulk mining cohort, BHP Group Ltd (ASX: BHP) rose 22 cents, or 0.5 per cent, to $47.27; Rio Tinto Ltd (ASX: RIO) lifted 46 cents, or 0.4 per cent, to $132.92; and Fortescue Ltd (ASX: FMG) gained 18 cents, or 0.6 per cent, to $29.88.

In coal, Whitehaven Coal Ltd (ASX: WHC) appreciated 17 cents, or 2.1 per cent, to $8.43; New Hope Corporation Ltd (ASX: NHC) was up 14 cents, or 2.7 per cent, to $5.40; Coronado Global Resources Inc (ASX: CRN) added 2.5 cents, or 1.6 per cent, to $1.64; and Yancoal Australia Ltd (ASX: YAL) firmed 10 cents, or 1.7 per cent, to $5.99; but Australian-South African producer Terracom Ltd (ASX: TER) slipped 4.5 cents, or 12.7 per cent, after disappointing with its December 2023 quarterly result, in which coal tonnes from continuing operations came in 24 per cent lower than the previous quarter.

Whitehaven Coal share price

In gold, De Grey Mining Limited (ASX: DEG) strengthened 2.5 cents, or 2.1 per cent, to $1.225; Genesis Minerals Ltd (ASX: GMD) gained 2.5 cents, or 1.6 per cent, to $1.625; Ramelius Resources Ltd (ASX: RMS) was up 1.5 cents, or 1 per cent, to $1.595; Evolution Mining Ltd (ASX: EVN) added 2 cents, or 0.6 per cent, to $3.21; and Newmont Corporation CDI (ASX: NEM) rose 15 cents, or 0.3 per cent, to $52.72; but Bellevue Gold Ltd (ASX: BGL) was down 4 cents, or 2.9 per cent, to $1.33; Capricorn Metals Ltd (ASX: CMM) also lost 4 cents, or 0.9 per cent, to $4.59; Northern Star Resources Ltd (ASX: NST) gave up 18 cents, or 1.4 per cent, to $13.15; and Gold Road Resources Ltd (ASX: GOR) eased 1.5 cents, or 1 per cent, to $1.52.

Nickel Industries continues surge

Indonesian-based Nickel Industries Ltd (ASX: NIC) was among the top performers in the benchmark for a second straight day running, spiking a further 9.7 per cent higher, up 7 cents to 79 cents. That makes a one-third surge in just two days, after the nickel producer rewarded investors with an increased dividend and launched an on-market share buyback valued at up to $151 million.

Nickel Industries share price

In lithium, producer Arcadium Lithium CDI (ASX: LTM) slid 32 cents, or 4 per cent, to $7.78; fellow producer Pilbara Minerals Ltd (ASX: PLS) eased 5 cents, or 1.4 per cent, to $3.55; Mineral Resources Ltd (ASX: MIN), which mines iron ore and lithium, retreated 89 cents, or 1.5 per cent, to $59.95; and IGO Ltd (ASX: IGO), which produces nickel as well as lithium, sank 17 cents, or 2.2 per cent, to $7.56, after mothballing its Cosmos nickel project, following a review of the mine’s prospects amid a deteriorating nickel price.

Copper miner Sandfire Resources Ltd (ASX: SFR) surged a further 18 cents, or 2.5 per cent, to $7.30.

Canadian-based iron ore producer Champion Iron Ltd (ASX: CIA) brought out December quarter results that showed record production, which saw the shares jump 39 cents, or 4.8 per cent, to $8.53.

In energy, Woodside Energy Group Ltd (ASX: WDS) lifted 54 cents, or 1.7 per cent, to $32.41; Santos Ltd (ASX: STO) gained 9 cents, or 1.2 per cent, to $7.85; Beach Energy Ltd (ASX: BPT) moved 4 cents, or 2.5 per cent, higher to $1.66; and Brazilian-based producer Karoon Energy Ltd (ASX: KAR) appreciated 3 cents, or 1.6 per cent, to $1.955. Origin Energy Ltd (ASX: ORG) gained 22 cents, or 2.7 per cent, to $8.52, while fellow ‘gentailer’ AGL Energy Limited (ASX: AGL) slipped 5 cents, or 0.6 per cent, to $8.67.

Semiconductor tech developer Weebit Nano Ltd (ASX: WBT) lost 38 cents, or 9.8 per cent, to $3.47. In its latest quarterly report, the reported weaker-than-expected revenue and said it expected no royalty payments 2024 as clients using its technology continued to ramp up to production.

Weebit Nano share price

Debt collector Credit Corp Group Limited (ASX: CCP) lost 45 cents, or 2.6 per cent to $17.21, after reporting that it was on track to come in at the bottom end of its profit guidance: Credit Corp lodged a net loss in its most recent half-year.

Biotech heavyweight Csl LTD (ASX: CSL) advanced $4.96, or 1.7 per cent, to $301.70. Telstra Group Ltd (ASX: TLS) managed a 2-cent gain, or 0.5 per cent, to $4.04.

Fed disappoints on cut hopes

In the US, stocks fell after Federal Reserve chairman Jerome Powell said the central bank likely would not be ready to cut rates in March. That isn’t what investors wanted to hear, and the benchmark S&P 500 (INDEXSP: .INX) index retreated 79.32 points, or 1.6 per cent, to 4,845.65. The 30-stock Dow Jones Industrial Average (INDEXDJX: .DJI) lost 317.01 points, or 0.8 per cent, to close at 38,150.30, while the tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC) index was the hardest hit, giving up 345.89 points, or 2.2 per cent, to finish the day at 15,164.01.

On the bond market, the US 10-year yield sank below 4 per cent, slipping 11.5 basis points to 3.919 per cent. The 2-year yield eased 12.4 basis points, to 4.209 per cent.

Gold advanced US$2.14, or 0.1 per cent, to US$2,038.73 an ounce. The global benchmark Brent crude oil grade went back US$1.16, or 1.4 per cent, to US$81.71 a barrel, while West Texas Intermediate oil lost US$1.97, or 2.5 per cent, to US$75.85 a barrel.

The Australian dollar is buying 65.65 US cents this morning, down from 65.75 US cents at the ASX close on Wednesday.

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