FX.co ★ ASX 200 Rallies to New High

The S&P/ASX 200 advanced by 0.5% to surpass 8,810 on Wednesday, extending the previous session's record close and setting a new all-time high. This rise was fueled by growing expectations of both domestic and global interest rate cuts. Increasing speculation regarding a U.S. Federal Reserve rate reduction in September—currently estimated at a 94% likelihood—has boosted global investor appetite for risk. Additionally, Australian swap markets fully anticipate a quarter-point rate cut by the Reserve Bank of Australia (RBA) next week. Despite this optimism, caution persisted following a selloff on Wall Street, prompted by weak economic data that rekindled fears of stagflation. Adding to the unease, President Trump announced plans for significant tariffs on pharmaceuticals and semiconductors. Nonetheless, he hinted at the possibility of extending the trade truce with China prior to the August deadline, stating a deal is "very close." On the corporate front, gold stocks experienced significant gains amid rising bullion prices, climbing 2.6% to reach a two-week peak, with Northern Star surging by 3.4% and Newmont by 2.2%. Furthermore, major financial stocks increased by 0.8%, led by Commonwealth Bank of Australia, which rose by 1.3%. Additionally, real estate stocks, sensitive to interest rate changes, moved up by 0.7%.