The recent run of gains is continuing for a fourth straight day as US-China trade tensions appear to be easing. The Aussie market is following global markets higher as both sides discussed the importance for calm dialogue. At this stage, US tariffs are still proposed to rise by at least 5% on a number of goods on September 1.
The ASX 200 is equalling its best performance since June 11 this year as the benchmark index climbs 80 points or 1.23% to 6587. Gains are across the board with every sector higher. The main underperformer has been the consumer discretionary sector which is being weighed by a 1% fall for Wesfarmers (WES) as it trades ex-dividend.
The IT sector and resource sectors are making the largest percentage gains. Local energy producers are rallying on the back of firmer oil prices with Beach Energy (BPT) and Oil Search (OSH) rising most. The local tech sector is being buoyed by improvements of 3% or more for Afterpay Touch (APT) and Wisetech Global (WTC).
The past two weeks have also been a more optimistic time for investors as local shares lifting for a second straight week. Despite the recent run of improvements over the past fortnight, August is still on track for the largest monthly decline since October last year. Which also experienced wild volatility on an escalation in trade and global growth worries. The ASX 200 is down over 3% in August.
The end of the month also spells the close of the August reporting season with Harvey Norman (HVN), one of the last major companies to release profit results for the past financial year. The electronics and homewares retailer lifted total sales by 12% to $2.23 billion but the majority of revenue was made at its overseas stores. Australian franchisee sales fell 2%. HVN shares are down 1.7%.
Defensives, in particular gold names, are also in decline as demand for the safe haven of precious metals diminishes. Most major gold producers are down between 3-4%.
The Aussie dollar is easing against the greenback and has done so far the past six weeks to 67.13 US cents. A far weaker than expected reading for the July building approvals saw the local unit slip from roughly 67.3 US cents. So far, 1.5b units have been traded worth $3.8b with 652 stocks higher, 360 weaker and 356 unchanged.
Published by CommSec