The Australian share market has ended its day sharply higher and managed to recoup all of it losses from the previous day.
AMP has sold its remaining stake in a life insurance business for $524m
The Australian dollar has fallen to a two-week low
Iron ore prices have plunged by 59 per cent since May
The ASX 200 index gained 68 points (0.9 per cent) to close at 7,393.
Earlier on Wednesday, the benchmark index had jumped by as much as 1.5 per cent, before it lost some of its momentum in afternoon trade.
Seven of every 10 stocks traded higher, including AMP (+9.3pc), Orocobre (+6.7pc), Pilbara Minerals (+5.4pc) and the Commonwealth Bank (+1.1pc).
Financial services provider AMP said it had agreed to sell its remaining 19 per cent stake in Resolution Life’s Australia business to the British company for $524 million.
Notably, this marks AMP’s exit from the life insurance business.
Meanwhile, CBA said it will partner with a New York-based cryptocurrency exchange, and offer its customers the option to trade in about 10 different digital currencies through its banking app.
This would make CBA the first of the major Australian banks to offer crypto services.
ANZ shares jumped 2.3 per cent, outperforming the other big three banks.
Commonwealth prosecutors dropped a long-running criminal cartel case against ANZ and one of its senior executives after the Federal Court described the matter as a “complete shemozzle”.
On the flip side, Tyro Payments (-15pc), Redbubble (-3.9pc), Uniti Group (-3.6pc) and Hub24 (-3pc) suffered heavy losses.
Australian dollar tumbles after RBA decision
The Australian dollar was trading at 73.37 US cents at 4:45pm (AEDT), having recovered some of its overnight losses.
At its lowest point, the local currency had dropped to a two-week low of 74.2 US cents (down 1.5 per cent), partly due to a stronger greenback.
Its fall also occurred after Tuesday’s decision from the Reserve Bank that suggested Australia may experience a rate hike before 2024.
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However, the central bank’s guidance was seen by the market as more “dovish” than expected. RBA governor Philip Lowe said the cash rate will not rise until inflation is sustainably within the 2 to 3 per cent target.
“Nevertheless, the RBA’s ‘patient’ approach to tightening monetary policy and Governor Lowe’s pushback on a 2022 rate lift‑off caused Australian interest rate markets to pare back some tightening expectations,” said Commonwealth Bank currency strategist Carol Kong.
“The US dollar could lift further if the FOMC [US Federal Open Market Committee] announces it will begin tapering its monthly asset purchases by $US20 billion a month in November compared to expectations of $US15 billion a month”.