Closing Bell 15th November: ASX Nears Two-Month High as US Inflation Data Fuels Market Optimism

‘Inflation Fever Has Broken’ in the US
Global stock markets are rallying as US inflation slows, with the Consumer Price Index rising just 3.2% year-on-year in October, down from 3.7% in previous months. This deceleration, marked by flat prices compared to the previous month, signals a significant shift. Wall Street responded positively, with the Nasdaq and S&P 500 both seeing substantial gains, led by companies like Tesla and Nvidia. In the bond market, US 10-year note yields fell notably, reflecting a change in investor sentiment and expectations.

Australian Wages Record Highest Quarterly Growth
Australia’s wage growth hit a record high in the third quarter, with a 1.3% increase, bringing the annual rate to 4%. This surge, the highest in the 26-year history of the Wage Price Index, is a key driver of inflation, currently exceeding the Reserve Bank’s target range. The recent pay rise for aged care workers significantly contributed to this growth. With the upcoming Labour Force data release, these figures will likely influence the Reserve Bank’s future rate decisions.

Iron Ore Prices Soar on Chinese Demand and Stimulus Hopes
Iron ore futures in Singapore reached $US130 per tonne for the first time since March, driven by increasing steel demand in China and potential stimulus measures for its property sector. The commodity’s price has risen by a third since May, boosted by reports of substantial financing for housing programs in China. While there’s optimism about restocking ahead of the Lunar New Year, concerns remain over the Chinese property sector’s downturn and potential government interventions in iron ore pricing. The Dalian and Shanghai markets also saw significant increases in iron ore and steel prices.