Home Travel n Tour ASX breaks record level before China move bites

ASX breaks record level before China move bites


The benchmark index of the ASX pierced a level never reached before then pulled back after China’s latest trade move hit local mining stocks. The Australian share market climbed to heights never seen before, then pulled back after China’s latest bid to suppress soaring commodities prices hit local mining stocks.

The benchmark S&P/ASX200 index smashed through 7400 points for the first time in morning trade before closing barely changed – just 6.7 points firmer at 7386.2 – while the All Ordinaries Index inched 0.4 points higher to 7633.4. CommSec analyst James Tao said it was a strong start despite a negative lead from Wall Street.

Already jittery US investors mulled data showing more substantial inflation and weaker retail sales in May as they awaited the results of the Federal Reserve’s latest policy meeting, Ord Minnett said. “They’ll be wrapping up their two-day meeting early on Thursday morning local time, so certainly we’ll get a bit more understanding of how the central bank in the US feels about the economy and inflation, more importantly,” Mr. Tao said.


On the ASX, energy stocks led gains followed by financials, healthcare, and consumer staples, offsetting losses for miners. Woodside Petroleum put on 2.28 percent to $24.27, Oil Search advanced 1.46 percent to $4.18, Santos gained 1.04 percent to $7.76, and Beach Energy rose 1.11 percent to $1.37.

Commonwealth Bank appreciated 1.32 percent to $104.82 – yet another fresh all-time high after a string of recent record closes. “It’s on a tear at the moment and is doing a great job providing support to the whole market. It looks very bullish technically,” OMG chief executive Ivan Tchourilov said. ANZ added 0.91 percent to $28.92, National Australia Bank improved 0.71 percent to $26.86, and Westpac was steady at $26.55.

Regenerative medicine developer Avita Medical, founded by renowned burns expert Professor Fiona Wood, surged 12.38 percent to $5.63 after announcing an upgrade to its fourth-quarter revenue guidance. “As people begin to return to normal activities after the confines of the COVID-19 pandemic, we have seen an increase in burn accidents requiring treatment with the RECELL System in burn centers across the country,” chief executive Mike Perry said.

Another strong performer in the health sector was Telix Pharmaceuticals, which jumped 6.04 percent to $5.62, while biotech giant CSL lifted 0.39 percent to $302.90. CommSec senior economist Ryan Felsman said it was a positive sign for retailers the weekly ANZ-Roy Morgan consumer confidence rating rose by 0.3 percent to 111, compared to the long-run average since 1990 of 112.6, while consumer views on whether it was a ‘good time to buy a major household item’ jumped by 3.3 percent.

“The outlook for consumer spending remains positive, supported by rock bottom borrowing costs, elevated consumer confidence, excess household savings, solid job growth, and rising asset prices,” Mr. Felsman said. Coles put on 0.35 percent to $17.05, and Woolworths strengthened 0.46 percent to $43.70. Mining stocks fell after Bloomberg reported China’s latest move to quell raw materials price surges by ordering state enterprises to limit their exposure to overseas commodities markets and pledging to release the nation’s reserves of base metals.

Rio Tinto dipped 0.6 percent to $125.71, BHP dropped 1.73 percent to $48.37, and Fortescue shed 1.63 percent to $22.95. Myanmar Metals announced it had received a $66.5m non-binding takeover offer of 3.5 cents per share from Shenzhen Stock Exchange-listed miner Yintai Gold. The company’s shares last traded at seven cents in February. After the Myanmar military staged a coup against the democratically elected Aung San Suu Kyi-led government, it was suspended from trade.

“It should be noted that site-based due diligence inquiries may present a logistical challenge at this time due to the political situation in Myanmar and restrictions on travel due to the COVID-19 pandemic,” the explorer said. Gold producer Gascoyne Resources announced it would take over neighboring explorer

Firefly Resources for 0.34 of its shares for each Firefly share, representing an implied offer price of 14.5 cents per share. Gascoyne shares slipped 2.7 percent to 36 cents, while Firefly shares soared 20 percent to 12 cents. The Aussie dollar fetched 77.02 US cents, 54.52 British pence, and 63.45 Euro cents in afternoon trade.


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