ASX 200 Index continues its winning streak, which began on March 15.
Australian equity market gains grounds despite a lower Wall Street overnight.
Chinese President Xi Jinping to meet with American executives on Wednesday.
Adam Neumann made a bid to acquire the bankrupt WeWork for more than $500 million.
The ASX 200 Index recovers its intraday losses. It continues its winning streak following the Westpac Consumer Confidence data from Australia, which fell 1.8% to 84.4 in March 2024 from 86.0 in February, easing from 20-month highs. This development has bolstered market sentiment, leading to speculation that the Reserve Bank of Australia (RBA) would not adopt a hawkish stance. On Tuesday, the index trades higher around 7,800, up by 0.25% at the time of writing. However, Wall Street experienced a modest weakness overnight.
Today sees a significant drop in the A-VIX, plummeting 2.26% to 10.82. The All Ords is down by 0.25% at 8,051. Among the top performers within the ASX 200 Index, Elders surged by 5.04% to 9.38; Beach Energy rose by 4.61% to 1.82; and Premier Investments climbed by 2.99% to 31.56. The bottom performing stocks are Atlas Arteria, which dipped by 0.49% to 5.12; Arcadium Lithium, which experienced a 4.99% decline to 4.19; and Idp Education, which dropped by 3.51% to 17.46.
Chinese President Xi Jinping is set to meet with American business leaders in Beijing on Wednesday, following up on his November dinner with U.S. investors in San Francisco. The meeting was initiated by Evan Greenberg, the chief executive of US insurer Chubb. Among the attendees are Stephen Orlins, president of the National Committee on US-China Relations, and Craig Allen, president of the US-China Business Council.
The Chamber of Commerce suggests that lifting the uranium mining ban in Western Australia (WA) could lead to a yearly economic boost of $1 billion and the creation of 9,000 jobs. A report by the Chamber of Commerce and Industry of Western Australia (CCIWA) echoes the call by the Liberal party for a change in attitude towards uranium mining in WA.
Lithium Universe has completed a study to identify a suitable port location for importing spodumene to its proposed Bécancour lithium refinery in Canada. The company concluded that the optimal port would be located in Bécancour, approximately 2.5 kilometers from the refinery site in Québec.
Mitre Mining has made significant discoveries at the Cristal target within its newly-acquired Cerro Bayo project in Chile, uncovering outcropping silver-gold vein extensions boasting impressive grades of up to 32,849 grams per tonne of silver and 298.6 grams per tonne of gold.
Adam Neumann, the former chief executive and co-founder of WeWork, has recently bid to acquire the bankrupt co-working company for more than $500 million.
Inflation FAQs
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over some time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attracts more global capital inflows from investors looking for a lucrative place to park their money.
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
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