Miners lift as iron ore extends rally, data shows Australian inflation still rising
The ASX added another 0.50% on Monday on top of its 0.60% gain last week.
Shares in Mining lifted across the board as iron ore prices extended their rally on the back of China’s easing of its Covid restrictions.
China has accelerated the move towards easing its Covid polices after Shanghai and Hangzhou lifted their restrictions following heavy protests.
Chinese stocks rallied strongly last week, and today the Hang Seng index rose another 3.5%. Other Asian sharemarkets like Japan and South Korea also rallied today.
Iron ore futures traded in Singapore gained another 2.5% to $US108.35/t on the China news, lifting ASX miners like Fortescue Metals (ASX:FMG) and Rio Tinto (ASX:RIO) by 4% to 7%.
This follows the rally on the London Metal Exchange (LME) on Friday, where copper, nickel and aluminium all lifted.
The US dollar continues to fall against other major currencies, taking the greenback to a 5-month low and sending oil prices higher.
Major oil stocks on the ASX rose after OPEC+ decided on Sunday to retain the status quo and keep its production steady amid sliding crude prices.
This came as Russia rejected a proposal by EU countries to cap its oil export at US$60/barrel.
”We will not accept this cap. Starting from this year, Europe will live without Russian oil,” said a Kremlin spokesman.
Meanwhile, the Melbourne Institute’s inflation gauge report released today shows that living costs continue to crush Australian household budgets.
In October, the inflation index rose 0.4% after lifting 0.5% in September. The gauge is sitting at 5.9% higher compared to last November.
“In part, businesses are passing on cost increases, and in part, more people have jobs and wages are rising, lifting business sales,” said CommSec’s Craig James.
Bitcoin was up 0.3% in the last hour to US$17,257 as a local crypto exchange announced that it will fire 40% of its workforce.
Brisbane based Swyftx said the layoff was the company’s preparation in anticipation of a crypto winter that’s set to the grip the market over the foreseeable future.