The ASX is creeping higher after cooler-than-forecast economic growth figures became the latest in a series of soft data to take pressure off the need for more interest rate rises.
The S&P/ASX200 rose 41.8 points by midday, up 0.48 per cent, to 8,766.2, as the broader All Ordinaries gained 33.7 points, or 0.39 per cent, to 9,001.
Australia’s economy grew at 0.3 per cent in the three months to March, undershooting expectations by 0.5 per cent and coming in at 2.5 per cent in annual terms.
The figures followed softer than expected April jobs and inflation figures, lowering the odds the Reserve Bank will have to continue hiking the cash interest rate on its road to temper sticky price growth.
The ASX-listed mining sector was doing some heavy lifting, with materials up two per cent as BHP and Rio Tinto shot to new record highs as copper prices surged.
Energy stocks rallied 1.4 per cent as Brent oil firmed to $US97 a barrel, as Middle East tensions continued to flare and with US-Iran talks at an apparent standstill.
“While commodity markets were relatively steady overnight, investors remain alert to any developments that could quickly shift energy prices or broader risk appetite,” Moomoo dealing manager Chris Strazzeri said.
Coal miners also advanced, and uranium stocks made a comeback as a resurgent artificial intelligence narrative sent Wall Street’s tech-led Nasdaq to new highs overnight.
However, the uplift wasn’t universal and favoured chipmakers and data centre infrastructure plays over software companies, which sold off.
The sell-off was echoed on the local market, with Xero, WiseTech and Life360 each down between two and three per cent, while data centre group NextDC surged 2.8 per cent.
Australia’s heavyweight financials sector continues to languish amid a softening housing market, growth concerns and tax regime change, the sector trading roughly flat as three of the big four banks eked minor gains but insurers and investment firms lost ground.
Consumer discretionaries tipped 0.5 per cent lower, the segment remaining vulnerable in the current economic situation, according to VanEck investments and capital markets head Russel Chesler.
“Australia could now be entering a stagflationary regime of low growth and high inflation,” Mr Chesler said.
“GDP growth is slowing, unemployment is rising and inflation remains elevated.”
In company news, Ampol shares rallied more than two per cent after the competition watchdog approved the refinery operator’s EG Australia acquisition, subject to conditions.
Maggie Beer shot 14 per cent higher after receiving an up to $10 million takeover bid for its Hamper and Gifts Australia (HGA) business from an unnamed suitor.
The Australian dollar is buying 71.77 US cents, roughly on par with 71.78 US cents on Tuesday at 5pm AEST.