Australian markets rally as Fed signals end to aggressive rate hikes

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Australian markets rally as Fed signals end to aggressive rate hikes
Credit: © Reuters.

The Australian share market saw a significant surge, reaching a near two-week high following indications from Federal Reserve Chairman Jerome Powell about an end to aggressive rate hikes. The S&P/ASX200 and All Ordinaries rose by 1.2% and 1.25%, respectively, marking the ASX200's best day since September 15, 2023.

This uptick was largely led by the tech and property sectors. Notably, interest-rate tech stocks such as Xero, Wisetech Global, and Altium reported over 3% increases each. Real estate and telecommunication stocks also performed well in this market rally.

Wall Street followed suit with its best session in over two weeks, while US 10-year Treasury yields reached a two-week low. JPMorgan economists pointed out Powell's satisfaction with the progress toward inflation targets as a key driver of these positive trends.

In contrast, utilities fell by 3.8%, and Origin Energy experienced a drop in shares by 6.6%, following resistance to its potential acquisition by a private equity consortium led by Brookfield. This decline came despite the Australian dollar standing at US64.25¢ and the broader market rally.

Furthermore, Santos shares fell after a federal court ruling against the commencement of its Barossa gas pipeline project in the Timor Sea. Despite these sector-specific setbacks, the Big Four Australian banks and mining giants BHP and Rio Tinto (NYSE: RIO ) reported higher trading.

Among other notable performers was Sayona Mining, which emerged as the best-performing stock, rising 8.3%. This surge followed the discovery of multiple high-grade lithium intercepts at its North American Lithium operation in Quebec, where it holds a 75% stake.

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