Rate call fails to dent ASX gains

By the Editorial Team · Thursday, October 22, 2026

The Australian sharemarket rose modestly on Wednesday, driven by gains in telecommunications and major banks despite declines in the technology sector and concerns over rising oil prices. Investors remain cautious as Reserve Bank comments signaled potential near-term interest rate hikes to address worsening inflation, while geopolitical tensions and sector-specific challenges continue to weigh on sentiment.

The Australian sharemarket closed higher on Wednesday despite concerns about rising oil prices and the potential for further interest rate increases. The benchmark S&P ASX 200 ended the day up 14.4 points, or 0.16 percent, at 8,831.3, supported by a rally in the late afternoon. The broader All Ordinaries index also increased, gaining 12.4 points, or 0.14 percent, to finish at 8,956.6.

The Australian dollar recovered against the US currency, trading at 70.14 US cents. Market gains were broadly spread, with eight of the 11 sectors finishing in positive territory. Telecommunications and major banks were among the top performers. Telstra shares rose 1.89 percent to $4.85, TPG climbed 1.31 percent to $3.88, and Spark New Zealand closed up 1.66 percent at $1.53.

The banking sector contributed significantly to the gains, with Commonwealth Bank increasing 0.91 percent to $157.01. National Australia Bank surged 1.86 percent to $39.93, Westpac added 1.14 percent to $35.53, and ANZ edged up 0.62 percent to $39.22. However, the technology sector experienced a downturn, declining by 3.32 percent and dragging on overall market performance.

Investor sentiment was initially positive at the opening but weakened following comments from Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser. Hauser indicated that inflation data had been “materially worse” than anticipated, which market participants interpreted as a signal that interest rates might be increased again, possibly as soon as Melbourne Cup day.

Economists highlighted the RBA’s perceived shift in stance, with chief economist David Bassanese noting that recent remarks suggest the central bank is prepared to accept a more severe economic slowdown to curb persistent inflation. Bassanese added that the RBA, along with other international central banks, appears less confident in an imminent resolution to the conflict in Iran and acknowledges the inflationary pressures stemming from rapid developments in artificial intelligence, at least in the near term.

Further dampening market mood were rising oil prices, with Brent crude trading above US$110 per barrel following reports that a supertanker was damaged by a sea mine in the Strait of Hormuz.

On the corporate front, NextDC shares plummeted 41.72 percent to $5.35. Sigma Healthcare, owner of Chemist Warehouse, saw its stock decline 2.83 percent to $2.75, citing cost-of-living pressures negatively affecting discretionary consumer spending, though this was partially offset by strong demand in beauty and healthcare products, including GLP-1 weight loss medications. Mexican fast-food chain Guzman y Gomez’s shares fell 0.75 percent to $26.50 after early investor TDM Growth Fund sold $89.5 million worth of stock.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.