The Australian sharemarket closed at a fresh record on Wednesday as investors piled back into the beaten up mining sector and weak retail data bolstered hopes for an interest rate cut from the Reserve Bank next week.

The benchmark S&P/ASX 200 Index rallied 56.6 points, or 0.7 per cent, to 8597.7 on Wednesday, which pipped last month’s peak of 8592.1. Nine out of the 11 sectors finished in the green, led by mining and real estate stocks.

Despite a weak session on Wall Street overnight after US President Donald Trump said he would not delay the July 9 deadline for imposing higher tariffs on trading partners, the ASX pushed higher.

The great rotation

“July hit, and the market rallied,” said Bell Potter’s Richard Coppleson in a note to clients. “We saw the rotation trade today, where investors buy the worst (or poor) performers from the second quarter or first half and sell those stocks that have had great rallies.”

The mining sector – among the ASX’s worst performers over the last 12 months – climbed 1.8 per cent. Index heavyweight BHP rallied 1.7 per cent to $37.20, Fortescue 3.8 per cent to $15.97, and Rio Tinto 2.1 per cent to $108.30.

The big iron producers advanced with a higher commodity price after a Caixin/S&P Global survey showed Chinese manufacturing PMI rose to 50.4 in June, from 48.3 in May, surpassing expectations.

Real estate stocks also rallied on Wednesday, sending the sector up 1.8 per cent ahead of widely anticipated rate cut from the RBA next week. That’s after local retail sales data edged up just 0.2 per cent in May which was weaker than expected.

Markets are now pricing in a 98 per cent chance of a rate cut by the central bank next week, up from a 92 per cent chance before the data hit. ANZ is the latest bank to tip a 25 basis points rate cut on July 8.

The news boosted property developers, with Goodman Group, Mirvac, Stockland and Scentre Group all rallying more than 2 per cent, while Dexus jumped 3.1 per cent to $6.98.

“The retail sales data cemented the idea of a rate cut next week,” IG market analyst Tony Sycamore said. “We were expecting a pretty quiet session, but the subdued retail data showed more stimulus is needed, and that’s given the ASX a nice kick higher.”

Elsewhere, the local technology sector tracked US tech stocks lower. Tesla slumped 5.3 per cent after Trump threatened to withdraw subsidies from Elon Musk’s companies and review the billionaire’s immigration status.

On the ASX, Life360 fell 2.6 per cent to $32.72, Xero came off 2.1 per cent to $178.24 and NextDC dipped 1.1 per cent to $14.19.

Stocks in focus

In corporate news, Qantas shares fell 2.2 per cent to $10.52 after the airline revealed that the personal data of more than 6 million customers could have been stolen in a cyberattack.

Helia plunged 21.4 per cent to $4.31 after the lenders mortgage insurer revealed long-term customer ING Bank was negotiating a deal with alternative providers. CBA, another long-term partner, will pull the pin on its contract in December.

Domino’s Pizza tanked 15.8 per cent to $16.96 on news that chief executive Mark van Dyck is stepping down in December after less than one year in the role.

James Hardie rose 5.3 per cent to $42.93 after announcing its acquisition of US decking company Azek had been completed.

Perpetual jumped 8.8 per cent to $20.14 on the back of a ratings upgrade from UBS to “buy” from “neutral” with a short term price target of $22.50. Fellow wealth manager Magellan also climbed 6 per cent to $9.24 after UBS reiterated its “buy” recommendation saying performance had “stabilised”.

And Corporate Travel Management came off 3.6 per cent to $13.79. Jefferies downgraded the stock to “hold” with a short-term price target of $14.20, implying a decline of about 7 per cent.