The lifters

Energy companies (up 2.2 per cent) were among the strongest on the local bourse as Woodside (up 2.8 per cent) and Santos (up 1.6 per cent) lifted on the back of a lift in oil prices. Miners were also stronger, with heavyweights BHP, Rio Tinto and Fortescue advancing 1.8 per cent, 2.4 per cent and 1.8 per cent respectively.

The laggards

Healthcare (down 0.4 per cent) was the weakest sector on the index, with Cochlear (down 1 per cent) and EBOS Group (down 0.9 per cent) among the biggest large-cap decliners.

Information technology companies (down 0.5 per cent) were also weaker, as data centre operator NEXTDC (down 1.4 per cent) and WiseTech (down 1.3 per cent) slid lower.

The lowdown

Sage Capital managing director Sean Fenton said markets were quiet but reasonably strong on Wednesday on the back of international factors.

“Resources were stronger after some strong data out of China yesterday,” Fenton said. “Oil companies were stronger on oil production cuts by Saudi Arabia and Russia.”

Fenton said consumer price index data due out of the US on Wednesday night would be a key determinant of the direction of markets in the short term.

“There’s a cautious tone in markets,” Fenton said. “It’s always a challenge when central banks are lifting interest rates, but lower US inflation would help lift markets.”

Overnight, stocks climbed as Wall Street prepared for an upcoming update on inflation that will hopefully show a smaller increase in pain for everyone. The S&P 500 rose by 0.7 per cent, the Dow Jones gained 0.9 per cent and the Nasdaq composite added 0.5 per cent.

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Activision Blizzard jumped 10 per cent for one of the market’s larger gains after a judge ruled Microsoft could move forward on its $US69 billion ($103 billion) takeover of the video game maker.

Much of Wall Street’s gains for the day came at the end of trading, with about a third of the S&P 500’s rise happening in the final 20 minutes. The week’s main event will arrive overnight, when the US government will offer the latest update on inflation at the consumer level.

Economists expect to see another slowdown, with prices 3.1 per cent higher in June than a year earlier, down from inflation of 4 per cent in May and just above 9 per cent last summer.

The hope on Wall Street is that a continued easing in inflation will convince the US Federal Reserve to stop its hikes to interest rates soon. High rates have helped pull down inflation, but they’ve also caused cracks in the banking, manufacturing and other industries, while also hurting prices for stocks and other investments.

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Later in the week, companies will begin telling investors how much profit they made during the spring, and expectations are largely dim. Analysts are forecasting the sharpest drop in earnings per share for S&P 500 companies since the pandemic was crushing the global economy in the spring of 2020.

Bank of America drifted between losses and gains after regulators ordered it to pay $US250 million in customer refunds and fines.

It ended with a gain of 1.3 per cent after regulators said it double-dipped on fees, withheld rewards on credit cards and opened accounts without customers’ knowledge.

In the bond market, Treasury yields were mixed after rising last week on expectations the Fed will keep interest rates higher for longer in its campaign to get inflation under control.

Tweet of the day

Quote of the day

“If this pilot project is successful, it could be a game changer for Australian alumina production, paving the way for deployment across the industry,” said ARENA chief Darren Miller as Rio Tinto looks to build a pilot hydrogen processing plant and retrofit its Queensland alumina refinery in a bid to replace natural gas with clean hydrogen to superheat aluminium in the refining process.