ASX climbs despite grim rates warning

The Australian share market rose on Tuesday as traders shrugged off the release of new Reserve Bank board minutes which showed it was prepared to hike interest rates again.

The S&P/ASX200 added 0.3 per cent, or 19.8 points, to close at 7,078.2, while the All Ordinaries climbed a similar amount to 7,289.3.

Across the benchmark, seven of 11 industry sectors finished in the red, led by losses in utilities stocks which sank 1.8 per cent.

The Australian dollar rose to buy US66c.

Mining stocks were the best performers on the index following news of a fresh round of stimulus from Beijing.

Sector heavyweights BHP added 1.4 per cent to $47.40, Rio Tinto climbed 1.9 per cent to $127.37 and Fortescue added 0.7 per cent to $25.47.

On the Singapore exchange, iron ore futures climbed 1.3 per cent to $US132.85 a tonne for the December contract during afternoon trading.

Energy stocks also finished higher after oil stocks extended their gains on investor fears of OPEC+ supply cuts. Woodside Energy added 0.4 per cent to $31.91 while Nexgen Energy climbed 0.9 per cent to $10.09.

Fresh RBA minutes from its Melbourne Cup Day meeting revealed the central bank had left the door open for further rate hikes should inflation prove persistent.

“Members agreed that whether further tightening of monetary policy is required to ensure that inflation returns to target in a reasonable time frame would depend on how the incoming data alter the economic outlook and the evolving assessment of risks,” the minutes read.

Commonwealth Bank senior economist Belinda Allen said while the minutes showed the RBA has very little tolerance for inflation remaining higher than anticipated, recent data revealed an easing of price pressures.

“The RBA board meeting in December is currently not ‘live’ based on the flow of data received since the November meeting, including last week’s wages and labour force,” Ms Allen said.

“Further the early pulse of inflation data in the December quarter 2023 to date also points towards no more hikes to the official cash rate.”

In company news, Star Entertainment was unchanged, despite climbing 3.2 per cent early in trading, after the embattled casino operator announced an agreement with the NSW government on revised tax rates.

Brickworks shares slipped 1.9 per cent to $25.70 after the building products manufacturer said sales revenue was broadly flat in the September quarter as an increase in prices compensated for falling sales revenue.

The fall came despite its announcement that it was upping its final dividend by 42c a share (fully franked).

Holding its AGM on Tuesday, Fortescue Metals Group approved a $750m investment over the next three years for green energy and metal projects. Shares hit $25.81, their highest level since July 30 2021, before sinking later in the trading session.

Ahead of its highly anticipated shareholder vote on Thursday, Origin Energy sank 3 per cent to $8.28. Shares are roughly 12 per cent below the $9.43 offer shareholders will receive if they approve a takeover offer by a Brookfield-led consortium which AustralianSuper is set to torpedo.

Technology One sank 2.1 per cent to $16.07 despite announcing a 16 per cent increase in net earnings to $129.9 million.

The software company will pay a special 3c per share on top its final dividend.