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Early gains are fading for the Aussie market despite a strong lead from Wall Street. US markets were relieved to hear that the US Fed has changed its tune on interest rate movements after leaving rates unmoved at the conclusion of its most recent meeting. The Fed is now looking to be more “patient” when it comes to further rate moves. The more dovish tone, along with some better than expected US earnings, saw all major US indices rise more than 1.5%.
Back home, the ASX 200 is higher by 10 points or 0.2% to 5897 heading to lunch, with gains fading as the session progresses. The index was up by as much as 26 points at its best levels. Again, the energy and materials sectors are the main drivers for the improvements on the back of rising commodity prices. BHP Group (BHP) is climbing 1.3% and Rio Tinto (RIO) up 1.2%.
Fortescue Metals (FMG) is 3% higher after providing a quarterly update with shipments increasing 6% to 42.5mt over the December quarter and half year shipments were 82.7mt. The average realised price increased while costs decreased over the period as well.
Energy stocks have also benefitted from higher oil prices and better than expected production updates. Beach Energy (BPT) is jumping 7.5% after upgrading its FY19 output guidance to 28-29 mmboe after a strong Q2 update. Origin Energy (ORG) is also advancing 1.5% as integrate gas revenue rose 16% on higher LNG prices.
The IT sector is also lifting after a solid showing by the tech heavy NASDAQ in the US. Accounting software firm, Xero (XRO) is gaining 7% while Wisetech Global (WTC) is advancing 4%.
Offsetting the gains for resources and IT is weakness in financials with the big four banks all lower by up to 0.9%. Telstra (TLS) is another drag on the market as it stumbles 2.4% after climbing more than 7.5% on Tuesday. Propertygroup Goodman Group (GMG) is down 3%.
The Aussie Dollar has bounced higher on a more dovish tone from the US and on higher commodity prices. The local unit is buying 72.56 US cents. So far, 1b units have been traded worth $2.8b with 540 stocks higher, 400 lower and 357 unchanged.
Published by James Tao, CommSec
CommSec Daily Report Thursday
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