ASX 200 rises despite falling commodity prices
The Aussie market has risen for the fourth straight day and reached a three-week high despite falling commodity prices.
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Australia’s sharemarket has offset weakening iron ore prices for the fourth day running, with strong gains in information technology, telecommunications and health care seeing the market finish firmly in the green.
The benchmark ASX 200 index ended at a three week high up 27.70 points or 0.34 per cent to close Tuesday’s trading at 8285.10 points.
The broader All Ordinaries rose by 26.40 points or 0.31 per cent to close at 8542.90 points.
The Australian dollar gained slightly throughout the day, up 0.1 per cent to 62.40 US cents, despite falls in the iron ore price. Even with the gains, the Aussie dollar is still trading at near two-year lows.
It was an overall strong day, with eight of the 11 sectors trading higher. The gains were led by information technology stocks and telecommunications which were up 1.45 and 1.20 per cent respectively.
On the flip side, there was weakness out of the utilities and materials sectors. The materials sector was the worst performing, as the resource sector continues to face falling commodity prices.
The Singapore exchange futures prices showed iron ore fell to $US95.95 per tonne during Tuesday’s trading, continuing to fall from above $100 just five days ago.
“Miners though are feeling the pinch of a pressured iron ore price, which has continued to sink on slower hot metal output in China and a weakness in the top consumer’s equity markets,” Nabtrade wrote in a broker note.
“Gold and energy are singing the same tune, with the energy subindex on track to snap a nine-day winning streak on a dip in oil prices.”
The falling commodity price reflected on the miners share price, with Champion Iron down 6.38 per cent to $5.43 while Fortescue slumped 4.4 per cent to $17.25.
Fellow major miners BHP and Rio Tinto fell 0.72 and 0.68 per cent respectively.
In company news Nine Entertainment and IDP Education were among the top gainers during Tuesday’s trading. Nine Entertainment reached a near three month soaring 5.97 per cent to $1.33 to top all shares.
Investors reacted positively to broker commentary on IDP’s growth forecasts in FY26, irrespective of which major party wins this year’s federal election.
Macquarie analyst David Fabris lifted IDP Education to outperform at an unchanged target price of $16. IDP closed Tuesday up 4.89 per cent to $12.86.
“The recent lowering of student visa caps and upcoming elections in Australia and Canada have created significant uncertainty for IDP given volume impacts to student placements and English Language testing,” he said.
Markets will be watching for Australia’s CPI data due out Wednesday morning, with a low reading for the month of November adding further weight to a rate cut.
Currently the money markets have 100 per cent priced in a rate cut by April.
Originally published as ASX 200 rises despite falling commodity prices
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