Australian shares rebound from three-month low, remain on track for weekly loss

On Friday, Australian shares rebounded from a three-month low, edging closer to breaking even for the week, despite market concerns over rising interest rates and persistent inflation. The S&P/ASX 200 index climbed 0.4% to 8,647.8 points by early morning. For the week, however, the benchmark index slipped 0.2%, despite a 15-year peak in cash rates and inflation remaining higher than expected.

The market's downturn culminated on Thursday, marking its lowest level since mid-June, driven by a surge in bond yields. Concurrently, Australian government bond yields mirrored a decline in US Treasuries, with the benchmark 10-year yield easing to 5.36% and the three-year yield to 4.88%. Financial institutions witnessed a rise of up to 0.6%, but were poised for a fourth straight weekly decline if momentum held.

All major banks recorded a gain between 0.2% and 0.8%. Energy stocks surged 1.8%, marking their best day since mid-September, as oil prices surged following China's suspension of fuel exports. Energy stocks, notably Santos and Woodside, surged 2.2% and 1.5%, respectively. The mining sector also recorded a gain of 0.7%, with BHP and Rio Tinto leading the charge at 0.7% and 0.5%, respectively, while gold stocks were up 0.4%.

Technology stocks, meanwhile, rose up to 3.8%, achieving their highest point since early September. The index is on track to halt a sixth consecutive weekly loss, having jumped 5.8% this week. Consumer staples and discretionary stocks rose 1% and 0.4%, respectively. Conversely, healthcare sub-index declined by 0.5%, while real estate stocks fell 0.6%. Meanwhile, New Zealand's benchmark S&P/NZX 50 index closed lower by 0.7% to 13,715.99 points.