ASX edges lower, inflation continues to cool
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The news: The Australian sharemarket finished lower on Wednesday, following a weak overnight session on Wall Street. The benchmark ASX 200 lost 0.69% to 7,468.50, giving up most of its gains since an early spike on Tuesday. Australia's monthly inflation gauge came in slightly lower than expected in the year to November, with core inflation dipping sharply in further signs the Reserve Bank's rate hiking cycle is working.
The numbers: Materials stocks led the losses, falling 2.1% as fading iron ore prices dragged on BHP, Fortescue and Rio, which all lost more than 2%. Mineral Resources lost more than 6% after buying-up a 10% stake in the much-hyped lithium play Kali Metals.
The Australian dollar is buying 67 US cents after gaining about 0.25% since this morning's CPI print. Oil prices have been inching higher on falling US crude stocks and continuing uncertainty around the commodity's supply-demand. West Texas futures are trading at USD72.54 while Brent crude is fetching USD77.70 a barrel.
The context: Overnight, Bank of England governor Andrew Bailey is due to testify before the the Treasury Select Committee in London, and the US Treasury will hold its 10-year bond auction at about 5am AEDT tomorrow. US inflation data is due overnight on Thursday, and traders will be watching closely to get a sense of how those figures will influence US interest rate cuts in 2024.
