Australian Miners Rally as China Pledges More Stimulus

Australian miners saw a surge on Tuesday after China's commitment to additional stimulus measures aimed at revitalizing its sluggish economy was announced.

During a Politburo meeting on Monday, China signaled plans for more proactive fiscal stimulus and moderately looser monetary policies in 2025, which positively influenced market performance.

The S&P/ASX 300 Metals & Mining sub-index climbed nearly 4% following this announcement, with notable gains across various companies:
– Fortescue Metals Group (ASX:FMG) led the charge, rising nearly 7% to its highest level in two months.
– The world's largest iron ore producer, Rio Tinto Ltd (ASX:RIO), gained over 5%.
– BHP Group (ASX:BHP) saw an increase of nearly 4%.
– In the lithium sector, Pilbara Minerals Ltd (ASX:PLS) surged 7.2%, while Liontown Resources Ltd (ASX:LTR) and IGO Ltd (ASX:IGO) rose by 3.5% and 5.8%, respectively.

Chinese construction, manufacturing, and energy sectors are major consumers of Australian minerals. Stimulative policies from China, such as infrastructure investments and monetary easing, could bolster imports of raw materials, thus supporting mining stock prices.

However, it's worth noting that the broader Australian benchmark index, the S&P/ASX 200, was down 0.4% on the same day, as it awaited the Reserve Bank of Australia’s interest rate decision.

Looking ahead, investors remain focused on China’s upcoming Central Economic Work Conference scheduled for later this week.