Home Tech ASX makes strong start to June quarter, tech stocks top performers

ASX makes strong start to June quarter, tech stocks top performers


TODAY, the ASX staged a positive start to the new quarter, with tech stocks like Zip Co racking up decent gains while lithium miners also gained ground. The Australian share market climbed higher for the second straight day, with tech stocks taking a positive lead from Wall Street. At the same time, lithium miners responded to an announcement by US President Joe Biden.

The S&P/ASX200 added 0.56 percent at 6828.7 while the All Ordinaries Index lifted 0.67 percent to 7064.2. CommSec analyst Steve Daghlian said it was a decent start to the first day of the June quarter, but much trade was choppy and cautious.

“Yesterday, the Aussie market wrapped up the sixth straight month of gains … we were up about 3 percent in the March quarter, so it has been a robust start to 2021 so far,” Mr. Daghlian said.


OpenMarkets Group chief executive Ivan Tchourilov said the tech sector was the strongest performer on Thursday after Nasdaq led the charge on US markets overnight off the back of President Biden, unveiling more details of his $US1.9 trillion stimulus package.

Buy-now-pay-later market leader Afterpay put on 3.96 percent to $105.52, more miniature rival Zip Co rose 4.61 percent to $7.72, and accounting software provider Xero advanced 3.43 percent to $130.87.

President Biden announced a record $US176bn would go towards electric vehicle investment to create a nationwide charging network by 2030, which should boost the resources sector, especially lithium and battery-related stocks, Mr. Tchourilov said.

Galaxy Resources jumped 7.12 percent to $2.71, while fellow lithium miner Pilbara Minerals gained 3.83 percent to $1.08. Rio Tinto appreciated 1.13 percent to $112, BHP added 0.77 percent to $46.65, and Fortescue lifted 1.3 percent to $20.25.

Building products supplier, Boral jumped 6.74 percent to $5.86 after announcing the completion of the sale of its 50 percent stake in the USG Boral joint venture to Gebr Knauf KG, with the $1.33bn proceeds partly earmarked for reducing debt. Boral also revealed it would also use the proceeds to undertake an on-market share buy-back of up to 10 percent of its shares on the issue over the next 12 months.

AMP announced chief executive Francesco De Ferrari was stepping away from the embattled wealth giant, and ANZ deputy chief executive Alexis George would become his successor sometime during the third quarter of this year.

Mr. De Ferrari was appointed in December 2018 to overhaul AMP after damning findings from the royal banking commission. Still, the group was rocked by further scandal last year after it emerged executive Boe Pahari had been promoted despite being penalized for an earlier sexual harassment incident.

Despite Brisbane’s snap three-day lockdown ending, with Queensland recording just one more locally-acquired COVID-19 case, travel stocks were mostly lower. Also, flagged deals with global asset manager Ares Management Corporation, which abandoned a complete takeover of AMP, have so far failed to transpire. Shares in AMP appreciated 4.74 percent to $1.32.

Webjet declined 5.38 percent to $5.28 after providing details of a convertible notes offering, Flight Centre backtracked 0.56 percent to $17.89, Qantas eased 0.2 percent to $5.10, and Corporate Travel Management retreated 0.56 percent to $19.50. “They (travel stocks) already improved yesterday, so they’re mostly just coming off the boil,” Mr. Daghlian said.

Airline Regional Express, however, gained 4.39 percent to $1.54. Macquarie Group got into trouble with the Australian Prudential Regulation Authority, which has compelled it to hold an extra $500m in operating cash after committing multiple material breaches of prudential and reporting standards relating to liquidity between 2018 and 2020.

In other words, the bank didn’t reveal enough information for APRA to monitor its financial stability adequately. Moody’s Investors Service vice president Frank Mirenzi said the breaches highlighted the challenges of managing such a diversified financial services group. Still, the rating agency considered its risk management a strength “and APRA’s add-on requirements have only a moderate effect on the group’s regulatory ratios.”

Macquarie shares dipped 0.47 percent to $152.12. ANZ lifted 0.21 percent to $28.24, Commonwealth Bank added 0.13 percent to $86.21, National Australia Bank improved 0.39 percent to $26.10, and Westpac firmed 0.53 percent to $24.54.

CBA also got into trouble, with the Australian Securities and Investments Commission bringing civil proceedings against the bank, alleging it wrongly charged almost $55m monthly access fees to nearly one million customers between June 2010 and September 2019.

CBA says it accepts the errors should not have occurred, has apologized to customers, and made remediation payments but “does not accept the way that the alleged contraventions have been formulated in the proceedings and therefore will defend the matter”. The Aussie dollar bought 75.41 US cents, 54.78 British pence, and 64.33 Euro cents in afternoon trade.


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