The S&P/ASX200 was down a fraction, by just 1.90 points to 7,301.20 in afternoon trade.
The bottom-performing stocks in the index were Endeavour Group Ltd and IGO Ltd, down 10.22% and 5.21% respectively.
Over the last five days, the index has gained 3.68% and is sitting at 3.52% off its 52-week high.
Resourceful small caps
On the small cap front, having ‘Resources’ in your name seemed to be a hit with investors today, with Miramar Resources Ltd (ASX:M2R) moving up a whopping 26.8% and Lanthanein Resources Ltd (ASX:LNR) (up 15.8%), Sipa Resources Ltd (ASX:SRI) (13.6%) and Surefire Resources NL (ASX:SRN) (13.3%) all following it into the bright green.
By sector, Health Care was the strongest performer (up 0.97%) followed closely by Consumer Discretionary (0.58%) and Information Technology (0.59%), while at the other end of proceedings, Consumer Staples (-0.74%) and Materials (-0.85%) paced the market down.
Wealth Within chief analyst Dale Gilham had some thoughts about the inflation-recession equation we’re all scratching our heads about at the moment and what it means for investors:
“Recent data indicates that inflation appears to be easing in both the US and Australia with some suggesting it may have already peaked and that we could avoid a recession. While this sounds encouraging, the headline inflation rate is still way too high, which is why we need to consider how this will affect the stock market for the remainder of this year.
“We know the RBA is targeting a 2-3% inflation rate, yet it is currently around double that. As such, some experts are indicating it may take some time for the RBA to reach that target.
"Given this, the financial hardship that Australian households are experiencing in increasing numbers may not ease any time soon. That said, on a positive note, we still have full employment, but this situation may not last too much longer, as businesses are also finding the current climate quite tough.
Inflation equals growth
“All of this implies that the stock market may not be overly bullish in the coming year but is that really the case? While the data indicates the economy may be slowing, we also need to consider that an inflationary environment is normally one of growth," Gilham said. "Yet that is not what we have experienced in the Australian economy over the past few years. It has also not been reflected in the stock market.
“While it is expected that the RBA will raise interest rates at least one more time if not twice this year, we are very close to interest rates peaking. There is a lot of cash sitting on the sidelines waiting to be invested, therefore, once rates peak, I believe two things will occur. The first is that consumer spending will start to rise and secondly, money will flow into the stock market.
“So, while the current economic situation may not seem all that positive, this is the time when smart investors get ready to profit, as I believe we still see a strong bull market before any major decline occurs.”
The five at five
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Rumble Resources makes potential 9-kilometre-long zinc-lead discovery in Earaheedy drilling
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Miramar Resources on verge of diamond drilling at Whaleshark IOCG Project
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On your six
US regulators investigate OpenAI over deceptive statements
In response to growing concerns over the risk posed by generating false information, the US Federal Trade Commission (FTC) has begun an investigation into artificial intelligence (AI) firm OpenAI, backed by Microsoft (NASDAQ:MSFT).
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The one to watch
Yandal welcomes significant shallow gold at HMS Sulphur
Yandal Resources Ltd (ASX:YRL) exploration manager Chris Oorschot tells Proactive the company has returned ‘significant’ shallow gold mineralisation from RC drilling at the HMS Sulphur Prospect within the Mt McClure Gold Project in Western Australia.
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