ASX Today Live News & Analysis

An early surge in Australian shares has faded by the close after a hotter-than-expected inflation print weighed on the outlook for borrowing costs.

The S&P/ASX200 eased from an almost 100-point rally to close 69.5 points higher on Wednesday, up 0.81 per cent to 8,606.5, as the broader All Ordinaries gained 75.1 points, or 0.85 per cent, to 8,899.3.

Morning exuberance quickly turned to caution after headline inflation jumped to 3.8 per cent in the year to October, well above consensus and Reserve Bank forecasts.

"Today's red-hot CPI has effectively torched hopes of a near-term RBA cut, and even put a rate hike back on the table - the equity market's least-wanted scenario," Vantage senior market analyst Hebe Chen told AAP.

"The shift triggered a sharp midday reversal, sending rate-sensitive tech lower while materials outperformed on the back of surging gold and iron ore prices."

A 1.7 per cent push in raw materials stocks led eight of 11 local segments higher, but an early 1.2 per cent upswing in the heavyweight financials sector eroded to a meagre 0.3 per cent gain by the close, capping broader upside.

Of the big four banks, ANZ and CBA edged higher, while NAB and Westpac each dipped more than 0.4 per cent.

The major miners supported the materials sector, with BHP and Fortescue jumping two per cent or more as iron ore and copper futures ticked higher during the session.

Gold stocks swung into the green as spot prices rose to $US4,167 an ounce on the back of increased US rate cut bets, supporting ASX-listed miners.

Lithium producers also performed well, with Liontown up 3.2 per cent, while Pilbara Minerals soared 7.2 per cent to $4.04.

Lynas Rare Earths grinded 0.1 per cent lower as boss Amanda Lacaze promised shareholders the company would make up its its power outage-induced production shortfall in 2026.

Energy stocks lifted 0.9 per cent on the back of modest gains in segment giants Woodside and Santos, and a positive day for coal and uranium stocks.

Consumer discretionary stocks performed well, up 1.2 per cent as November sales gathered steam, helping lift Wesfarmers and JB Hi-Fi.

Shares in home appliances giant Harvey Norman swung to a 1.3 per cent dip over the day, despite posting a 9.1 per cent improvement in total sales for financial year to November 20.

Temple and Webster's market value crashed by almost a third after its year-to-date revenue growth - a respectable 18 per cent - undershot expectations.

The traditionally defensive healthcare sector was up 1.2 per cent in a broad-based rally with an outsized performance from Fisher and Paykel Healthcare (+4.8 per cent) thanks to a guidance upgrade.

Market darling-turned-naughty stepchild Droneshield continued to edge its way back into investors' good books, the defence tech company up more than 25 per cent since its latest contracts update.

Droneshield's value has fallen by more than two-thirds since hitting a record $6.70 per share in October, but it's still up 179 per cent in 2025 despite a confidence crisis that followed key leaders dumping $70 million in stock earlier in November.

IT stocks, communications plays and utilities missed out on the broader rally, falling between 0.5 and 0.8 per cent.

The Australian dollar is buying 65.06 US cents, up from 64.58 US cents on Tuesday at 5pm AEDT, rising as interest rate markets pivoted towards potential rate hikes in 2026.

A lacklustre local growth outlook, coupled with rising inflation, is likely causing a headache for Reserve Bank board members.

"The local focus now turns to next week's GDP, a heavyweight print that will spell out how real the downside and stagflation risks are for Australia, and just how much more complicated the road ahead may become for the RBA," Vantage's Ms Chen said.

ON THE ASX:

The S&P/ASX200 rose 69.5 points, or 0.81 per cent, to 8,606.5

The broader All Ordinaries gained 75.1 points, or 0.85 per cent, to 8,899.3

The NZX 50 added 81.58 points (0.60%) to 13,562.01 while the Nikkei gained 899.55 points (1.82%) at the time of writing, to be closed at 49,559.07

Companies Holding Annual General Meeting (ASX 300):

Alkane Resources Ltd

Harvey Norman Holdings Ltd

Predictive Discovery Ltd

PRL Global Ltd

Temple & Webster Group Ltd

Tyro Payments Limited

Companies commencing Ex-Dividend Trading Today (ASX 300):

ALS Limited

Graincorp Limited

Infratil Limited