Sydney, May 20, 2026, 03:03 AEST
- ASX trading is shut between sessions. The exchange runs normal hours from 10 a.m. to 4 p.m. Sydney time on business days. CommSec
- The S&P/ASX 200 finished Tuesday 99.39 points higher at 8,604.70, up 1.17%. Bloomberg
- Traders stuck to rate bets after the RBA minutes and oil price risks stayed in focus.
Australian shares clawed back from a seven-week low on Tuesday. Banks and consumer staples were among the main gainers after minutes from the Reserve Bank of Australia hinted officials could hold off on another rate hike.
The move caught attention after Monday’s drop left the market shaky. The S&P/ASX 200, which tracks 200 top ASX stocks, is seen as the main barometer for Australia’s investable equities. S&P Global
The index closed up 1.2% at 8,604.70, reversing its 1.5% drop from Monday. Financials were up more than 1.7%, industrials gained 1.2%. Real estate stocks tacked on 1.8%. Consumer staples climbed 3% after Woolworths jumped 3.7%—JPMorgan had raised its rating on the stock to “overweight”. The Business Times
RBA minutes gave markets “a modest sign of relief” today, Hebe Chen at Vantage Market said, with traders seeing the language as less urgent and less aggressive for now. Chen said a pause is looking more likely in the near term, though a hike can’t be ruled out. The Economic Times
RBA Minutes: Most Backed May Rate Hike to 4.35%
Eight out of nine members on the RBA board supported a 25 basis point rise in the cash rate to 4.35%, according to the May minutes. The board said financial conditions would likely stay “somewhat restrictive,” tight enough to slow demand. They said the move would allow them room to watch the Middle East conflict and monitor effects on households and businesses. Reserve Bank of Australia
Big banks tracked higher along with the broader market. Shares in the big four were up from 1.3% to 2%. Miners slipped as commodity prices stayed weak. BHP Group edged down 0.1% and Rio Tinto was off 0.2%, weighing on the materials sector. The Business Times
Oil weighed on markets in both directions. Cheaper crude lifted risk appetite as the U.S. held off on an Iran strike, but the RBA remains cautious on energy costs and inflation. Reuters said Australian shares bounced earlier after the strike delay eased some market pressure. Reuters
Sarah Hunter, assistant governor for economics at the RBA, said higher oil prices mean “higher costs and higher consumer prices in the near term,” warning that companies may push those costs to consumers faster with inflation already high. Hunter added there’s more risk now that inflation expectations could drift up too. Reserve Bank of Australia
The main risk for the market is still oil. If oil remains high or if the Iran conflict drags on and cuts supply, investors could start factoring in another RBA hike and softer earnings. But if households and businesses pull back harder on spending due to cost-of-living pressure, inflation might drop faster, though company revenue could suffer. Reserve Bank of Australia
Tuesday’s rally helped claw back losses, but the question for Australian equities remains: is the rate pause a step to more stable markets, or just a brief pause before more tightening?
