• The ASX 200 closed slightly up today
  • The RBNZ lift rates by 50bp to 2.5%
  • Ahead tonight, the all important US CPI

Local blue chips whipsawed between minor gains and losses today, finally settling to a +0.2% close.

Investors were mostly sitting it out ahead of the crucial US CPI number which will be released later tonight (12.30pm NY time).

Forecast from 11 major banks is for the headline inflation to hit 8.8%, up from 8.6% last month.

The CPI is a critical data input into the Fed’s interest rates decision on July 26th. Some banks are predicting the Fed won’t be too hawkish in July, following its 75bp hike in June.

“But with commodity prices easing substantively since then, there may be less pressure on the Fed to repeat with a 75 bps hike in July as inflation expectations are unlikely to be as worrisome,” said a note out of ANZ.

Earlier today, the Reserve Bank of New Zealand delivered its third consecutive 50p rate hike, lifting its cash rate to 2.5%, above the 2% the RBNZ had deemed neutral.

This evening, the Bank of Canada also has a chunky 0.75% rate hike pencilled in, while the Bank of England was beating the rate hike inflation-fighting drums last night. 

“All roads lead to the US inflation data this evening, which comes after a surprisingly strong non-farm payroll print last Friday,” said Oanda market analyst, Jeff Halley.

On the ASX today, it was a mixed day with Energy and Utilities losing ground by more than 1%, while Tech, Telcos and Discretionary all gained around 0.70%.

Tony Sycamore from City Index says Aussie coal miners continue to benefit as the EU stares down a possible total loss of Russian gas supplies, sending the price of coal even higher. Whitehaven Coal (ASX:WHC) added 4.7%, New Hope Coal (ASX:NHC) added 3.1% , Coronado Coal (ASX:CRN) added 1.6%  and Yancoal (ASX:YAL) added 1.%

“Concerns over fresh covid lockdowns in China and the rout in base metal prices have weighed on the Materials Sector,” Sycamore added.

  • South32 lost 1.8% to $3.49
  • Rio Tinto lost 1.5% to $94.00
  • Mineral Resources fell 1.4% to $44.18
  • BHP fell 1.36% to $36.95; and
  • OZ Minerals lost 0.1% to $16.27

The IT sector lifted during the retreat in bond yields. Megaport (ASX:MP1) rose p5.6% and Afterpay owner Block (ASX:SQ2) added 3.3%.

Sezzle (ASX:SZL) fell 15.7%  as the fallout from its failed merger with ZIP (ASX:ZIP) extended into a second session.

Energy stocks were beaten down by an 8% collapse in oil prices overnight, which have since rebounded slightly with Brent now trading at US$99.37 a barrel in Asian hours.

A 7% fall in iron ore price overnight also weighed on the Mining sector today, with most iron ore majors declining.

BIG CAP WINNERS

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Qantas (ASX:QAN) rose 4% on no news. But it was reported that vandals had targeted CEO Alan Joyce’s Sydney harbourside home amid the airline’s ongoing battle with its employees and customers.

BIG CAP LOSERS

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ANZ Bank (ASX:ANZ) was down 1% today after confirming that it was in discussions about a potential acquisition of MYOB, one of Australia’s leading providers of business management, financial and accounting software for SMEs.