ASX Large Caps: Local bourse gets jitters as inflation hits highest level since 1990 at 7.3%

• Australia records its highest inflation figures since 1990 at 7.3%, above consensus from economists
• Costa Group announces US company Paine Schwartz Partners  has acquired a 13.78% stake in company
• Medibank Private share price plummets after confirming all customers’ data compromised in cyber attack

It might be time investors and markets had a calming cup of tea with stocks paring gains after the latest inflation figures came out today, which were not pretty. Inflation has jumped to 7.3% over the year to September, its highest level since 1990 described by Federal Treasure Jim Chalmers as “public enemy No.1”.

Trimmed-mean inflation, the RBA’s preferred measure that trims away large price movements, rose 1.8% in the quarter and 6.1% annually suggesting inflation throughout the economy is broad-based.

Last night’s Federal Government budget figures had inflation reaching 7.75% by end of 2022, before slowing to 5.75% by June 2023 and then 3.5% by mid 2024.

The rising inflation figures were above consensus and raises the chance of a Melbourne Cup Day rate rise being much higher as the RBA moves to bring inflation back to its target of 2-3%.

Chalmers delivered his first budget since being elected in May with a five-point plan to address higher costs of living via reduced childcare costs, expansion of paid parental leave, cheaper medications, more affordable housing and getting wages rising.

“This is seven and a half billion package that helps put some money back in people’s pockets, boost productivity and grow the economy,” Chalmers said.

The S&P/ASX 200 finished Wednesday up 0.18%. The real estate sector led the winners, up by 2.49% followed by utilities, consumer discretionary and industrials.

Consumer staples led the laggards down 2.2% followed by the energy sector.

BIG CAP WINNERS

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While continual wet weather has put a dampener on vertically integrated fresh produce company Costa Group (ASX:CGC) today there was some sunshine among the clouds.

The company announced US sustainable food chain fund Paine Schwartz Partners was acquiring a 13.78% stake.  CGC said Paine Schwartz Partners indicated through its broker it was seeking to obtain an interest up to 15% through the after-market acquisition at a price of $2.60/share.

Among other big winners was lithium play Contact Energy (ASX:CEN)  and GUD Holdings (ASX:GUD) , which owns a portfolio of companies in the automotive and water products sector. Both had no news.

BIG CAP LOSERS

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It hasn’t been a good day for Medibank Private (ASX:MPL) which saw its share price plummet upon an update that the entity behind its cyber attack had access to all Medibank, ahm and international student customers’ personal data, including health claims.

The company said investigations into the cybercrime were continuing with a focus on identifying which systems and networks were accessed and which data was removed.