The sharemarket staged a turnaround on Wednesday as core monthly inflation cooled, buoying expectations that the Reserve Bank of Australia could cut interest rates as soon as next month.

The S&P/ASX 200 closed 0.8 per cent, or 64 points, higher at 8349.1 points on Wednesday, reversing a decline in early trading. The Australian dollar was broadly flat, trading at US62.28¢ after the market closed.

The turnaround came after the Australian Bureau of Statistics revealed core inflation in November fell to 3.2 per cent from 3.5 per cent in the prior month. Headline inflation, meanwhile, rose to 2.3 per cent, and job vacancies increased for the first time in two years.

That helped markets warm to the prospect that the Reserve Bank would lower interest rates as soon as next month, with consensus rising from a 60 per cent chance of a cut in February before the CPI figures to a 68 per cent chance.

“Today’s CPI indicator and job vacancy figures … suggest that the economy continues to gradually disinflate and that this is happening with a jobs market that remains strong,” said Paul Bloxham, HSBC chief economist for Australia, NZ and global commodities.

However, Bloxham cautioned that a tightening job market “will make it even harder to achieve the ‘last mile’ of getting core inflation all the way sustainably back to target.”

Bullish traders flocked to Australia’s stock market giants following the inflation print. Commonwealth Bank shares rose 1.7 per cent to $159.75, while ANZ rose 1.7 per cent to $29.52.

Miners staged a turnaround following several consecutive days of losses. Fortescue rose 1.9 per cent to $17.57, Rio Tinto lifted 1.1 per cent to $115.93 and BHP shares closed 1.8 per cent higher at $39.40

Other movers included Strike Energy, which rallied 7.3 per cent to 22¢. The Star Entertainment Group closed 5.4 per cent higher at 20¢ as trading in the 2024 laggard gathered momentum.

Stocks on the move

In company news, Avita Medical sank 19.3 per cent to $3.51 per share after the regenerative medicine business downgraded its commercial revenue guidance for 2024, owing to slower purchasing activity of its products.

Regal Partners shed 1.3 per cent to $3.70 after the funds manager said weaker performance in the final months of 2024 had modestly hit its annual performance fees, which are expected to be near $85 million.

Likewise, Florida-based investors GQG Partners slipped 4.6 per cent to $2.07 after telling investors its “institutional channel [had] continued to see moderate redemption pressure” in the December quarter.

And Gold miners Bellevue Gold, Regis and West African Resources were among the ASX’s top-performing stocks on Wednesday, as traders bet the commodity had further to run following 2024’s record gains. The three companies have reported record quarterly gold production in recent days.

Bellevue shares closed up 7.1 per cent at $1.06. Regis Resources shares closed at $2.73 and West African Resources closed at $1.55 – both up more than 4 per cent.