ASX Rises as RBA's 5-4 Split Cuts May Hike Odds to 25%
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- Australian shares rose after the RBA's narrow 5-4 vote cut market odds of another May rate hike to about 25% from roughly 70%
- Tim Waterer, chief market analyst at KCM Trade, warned that if the RBA keeps a hawkish stance while global rate cuts stay off the table, equities are likely to drift sideways or decline, though firmer commodity prices could still support the resource-heavy bourse
- Financials gained 0.6%, extending a third straight session of increases, and real estate stocks added 1%
- Miners climbed 1.1%, lifted by firmer bullion prices and gold-stock gains, while energy stocks dipped 0.7%, underperforming the broader market
- New Hope Corp fell 6.4% after reporting a sharp drop in first-half profit as weaker coal prices hit earnings
- Pepper Money slumped more than 14% after Challenger lowered its takeover offer for the non-bank lender
- New Zealand's S&P/NZX 50 index closed up 0.1% at 13,182.23, with investors awaiting Thursday's quarterly GDP data and the RBNZ's April meeting
Why it matters: The RBA's fractured 5-4 vote — the most divided outcome investors have seen — cut the implied odds of a follow-up May hike by roughly 45 percentage points, giving equities a near-term reprieve. But Waterer's warning that the same split signals a hawkish hold if global peers don't ease means the relief rally is conditional, and sector dispersion (coal miners and M&A-target lenders getting crushed) shows the macro tailwind isn't lifting all boats.
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