• ASX 200 climbs higher despite weak lead from Wall Street
  • Aussie unemployment at lowest since 1974
  • Coal stocks higher on unconfirmed rumours

ASX blue chips edged higher by 0.35% today, as Australia’s June unemployment rate fell to 3.5%, the lowest since 1974 when it was at 2.7%.

According to ABS data today, more than 54,000 people found themselves work in June.

The increase in June 2022 reflected the the eighth consecutive rise in monthly employment since the Delta lockdowns of late 2021. But there were also around 780,000 people working fewer hours than usual due to illness in June.

The RBA will next announce its monetary policy on August 2.

Overnight, the US headline inflation rose shockingly by 9.1% year on year in June to its highest in 41 years, beating market expectations of 8.8%. Excluding food and energy, US core CPI rose 5.9% year on year, versus 5.7% consensus.

Seema Shah, chief global strategist of Principal Global Investors, expects the Fed to respond aggressively.

“Inflation keeps heating up, defying expectations for a peak to be reached,” Shah said.

“With inflation now above 9% it is simply unthinkable that the Fed could slow its tightening pace and certainly market chatter about a Fed pivot will stop now.

“A 0.75% hike in July is surely a done deal and further increases of that magnitude cannot be ruled out. We see rates moving to 4.25% next year as the Fed desperately attempts to recover from its earlier erroneous inflation read,” Shah added.

Meanwhile, the ASX has shrugged off a weak lead from Wall Street overnight. Most sectors rose today, with Energy and Miners leading the pack following a rebound in commodity prices.

Coal majors rallied today on unconfirmed rumours that China was lifting its tariff on Australian coals.

 

BIG CAP WINNERS

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Coal stocks Yancoal (ASX:YAL) and Whitehaven (ASX:WHC) rose 9% and 6% respectively after unconfirmed China rumours.
 

BIG CAP LOSERS

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Lake Resources (ASX:LKE) fell 5% as the war between the company and short seller JC Capital spills over to Twitter.

Bega Cheese (ASX:BGA) fell 8% after issuing a trading update after the bell last night. The company said that milk, a big component of cheesemaking, jumped 30% in Victoria. But Bega said its full year earnings guidance of $175 ~ $190 million “remains current”.