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While the Australian sharemarket is lifting slightly for a third consecutive day, the ASX 200 has faded from this morning’s much more enthusiastic start due to declines from resource and bank stocks. The index was up by as much as 0.5 per cent on the open, before giving back most of its improvements at lunch. This is the third consecutive session that the local bourse hit its high in early trade before fading, which suggests some hesitation on the market’s part.

The US market’s 1.4 per cent lift overnight was driven by a near 4 per cent rally from the recently unloved technology stocks as bond yields declined overnight. American markets remained encouraged by the expectation of a US$1.9 trillion COVID-19 relief package (~A$2.5 trillion), which was passed by the US Senate at the start of the week and is scheduled to be voted on by the Democrat-controlled House of Representatives over the next day.

Technology stocks are standing out locally, with the sector jumping by 4.2 per cent at lunch. This follows six straight days of losses for the sector and an approximate 20 per cent tumble recorded over the past month.

Afterpay (APT) is up by ~8 per cent after completing the acquisition of a company called Pagantis, a buy-now-pay-later firm with a presence in Europe. APT expects the purchase to accelerate its expansion in Spain, France and Italy. In its half-year results last month, APT made 91 per cent of sales in Australia, New Zealand and the United States.

Unsurprisingly, iron ore and energy stocks are weighing on the market most on Wednesday. Fortescue Metals (FMG) is down 5.9 per cent, Rio Tinto (RIO) is down 3.6 per cent and BHP is declining by 2.2 per cent. This follows a 6.1 per cent drop in the iron ore price, which hit a three-week low, as one of China’s main steelmaking regions imposed restrictions on production in a bid to reduce pollution. The price of oil declined by 1.6 per cent after hitting a 13- month high and lifting by 7 per cent last week. Gold miners are higher following firmer precious metal prices.

Treasury Wine Estates (TWE) is up 2.5 per cent after reaching a long-term agreement with US based The Wine Group, which will source and sell some of its brands in the Americas. TWE said the deal would initially generate ~$100m for the group.

Brambles (BXB), Accent (AX1), Costa Group (CGC), 1300 Smiles (ONT), Regis Resources (REG), Shaver Shop (SSG) and Reliance Worldwide (RWC) are trading ex-dividend. Ansell (ANN) is set to pay eligible shareholders a 41.9c per share interim dividend today.

3.5bn shares have changed hands, worth a reasonable $3.3bn. At lunch, 808 stocks are up, 445 are down and 341 are flat.

Published by CommSec