The Australian sharemarket closed higher on Tuesday as investors responded to a fresh interest rate increase from the Reserve Bank of Australia, which lifted the cash rate by 25 basis points to 4.1% in a split decision.
The S&P/ASX 200 rose 30.9 points, or 0.4%, to finish at 8,614.3, with six of the index’s 11 sectors ending the session in positive territory.
The central bank warned that domestic inflation risks remain elevated, noting that the ongoing conflict in the Middle East could push fuel prices higher and add to price pressures.
The decision marked the closest vote by the monetary policy board since it began publishing vote tallies in July last year.
A-REITs led the market higher, with Goodman Group adding 1.2%, Charter Hall Group up 0.6%, Mirvac Group lifting 0.8%, and Stockland posting gains of 0.2%.
The materials sector also advanced, with major miners including BHP, Rio Tinto and Fortescue Metals adding 1.1%, 0.3%, and 1.3%, respectively.
Gold miners were mostly higher, tracking firm bullion prices. Evolution Mining rose 3.7%, Newmont gained 0.9%, and Northern Star Resources added 0.4%.
In contrast, the rate-sensitive technology sector declined following the rate decision. Shares in Xero fell 1.7%, TechnologyOne lost 0.4%, WiseTech Global slipped 3%, and NextDC finished 0.2% lower.
Energy stocks were mixed as oil prices eased overnight, before pushing higher during Asian trade. Santos rose 0.3%, Woodside Energy fell 0.7%, and Ampol eased 0.2%.
Among corporate developments, Catalyst Metals gained 7.6% after UBS initiated coverage on the gold producer with a Buy rating.
The broker said the stock appears attractively valued relative to its peers following a decline from near $10 per share in late January. UBS noted strong cash flow generation of $134 million at current record gold prices, with realised prices of around $5,855 per ounce in the first half of FY26.
Pepper Money dropped sharply, falling 14.9% after Challenger reduced its takeover offer to $2.25 from $2.60, citing a deterioration in market conditions and the broader operating environment.
Challenger shares closed 3.5% higher.
New Hope Corporation declined 6.4% after the coal miner reported a significant fall in half-year earnings and profit, as weaker coal prices offset otherwise solid production performance.
On the bond markets, yields edged lower. The 10-year government bond yield fell 0.3% to 4.941%, while the two-year yield slipped 0.1% to 4.529%.
