Cyclicals paced losses on a slightly down day for the FTSE 350 after the Reserve Bank of Australia surprised many in financial markets with a 50bp interest rate hike.
The unexpected move came as investors were waiting for the US consumer price report for May due out at the end of the week with consensus anticipating a further drift lower in CPI on an annual basis.
But investors appeared to remain a bit wary.
Some economists had been anticipating a 25bp increase by the RBA to 0.60% while yet others thought that it might hold off.
But citing the impact on inflation of Covid-19 supply chain disruptions and the war in Ukraine, rate-setters in Sydney opted to move more quickly and signalled that further tightening was likely in the coming months.
Against that backdrop and with Brent crude oil prices again edging higher, defensive areas of the market including Pharma and Tobacco found a bid.
Oil and Gas names also did well.
Nevertheless, so too did Industrial Metals on the back of ongoing optimism around the easing of pandemic restrictions in the People’s Republic of China.
Top performing sectors so far today
Pharmaceuticals & Biotechnology 20,822.60 +1.42%
Oil, Gas and Coal 8,222.12 +1.01%
Industrial Metals & Mining 8,246.23 +0.92%
Tobacco 37,163.25 +0.86%
Medical Equipment and Services 9,407.90 +0.78%
Bottom performing sectors so far today
Leisure Goods 17,708.64 -2.94%
Investment Banking and Brokerage Services 11,608.75 -2.41%
Automobiles & Parts 2,177.22 -1.50%
Real Estate Investment & Services 2,613.74 -1.50%
Life Insurance 6,814.44 -1.46%