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Highlights

  • S&P/ASX 200 rose 0.4% to 8,577.0 points, supported by mining and real estate gains.

  • Real estate stocks gained 1% amid rising expectations of an RBA rate cut next week.

  • Mining shares rose 0.9% as Chinese manufacturing data lifted commodity prices.

Australian shares advanced on Wednesday, buoyed by a rally in mining stocks and growing optimism over a potential interest rate cut by the Reserve Bank of Australia (RBA). The S&P/ASX 200 index increased 0.4% to 8,577.0 points in early trade.

Real Estate Stocks Lead on Rate Cut Bets

Real estate stocks led the market's gains, rising 1%, as investors reacted to indications of a potential interest rate reduction from the central bank. Swaps pricing suggests a 95.1% probability of a 25 basis point cut in the cash rate at the upcoming monetary policy meeting.

Expectations of lower borrowing costs are seen as a tailwind for the property sector, potentially enhancing consumer purchasing power and driving housing demand.

Financials Steady After Strong Year-to-Date Run

Financial stocks remained mostly unchanged, appearing to pause following a robust performance earlier this year. Among the major banks, Commonwealth Bank of Australia and Westpac both gained 0.3%, while National Australia Bank rose 1%.

Market participants are now turning their attention to upcoming retail sales data for May, expected later in the day. April’s figures showed a decline, prompting concerns about the state of consumer spending. Investors are also awaiting key U.S. economic data this week, which could influence global rate expectations and market sentiment.

Mining Stocks Gain on Chinese Manufacturing Data

Mining stocks climbed 0.9% after recent Chinese manufacturing data showed improvement, pushing copper prices to a three-month high. China remains Australia's largest trading partner, and stronger industrial activity there is often viewed as a positive signal for commodity demand.

Major miners BHP Group and Rio Tinto saw gains of 1.2% and 0.6%, respectively. The positive movement in base metal prices contributed to the broader strength across the mining sector.

Energy Sector Supported by Rising Oil Prices

Energy stocks rose 0.3%, supported by higher global oil prices. Leading companies in the sector, Woodside Energy and Santos, each posted a 0.3% gain, mirroring the broader uptrend in crude prices.

Domino’s and Qantas Weigh on Benchmark

In contrast to the broader market’s gains, Domino’s Pizza Enterprises was among the day’s top decliners, falling as much as 19% after announcing the sudden departure of Group CEO Mark van Dyck.

Qantas shares also came under pressure, dropping 3.7% after confirming a cybersecurity breach at one of its contact centres, which impacted customer data.

New Zealand Market Moves Higher

Across the Tasman, New Zealand’s S&P/NZX 50 index also rose, adding 0.4% to 12,789.55.