The Australian sharemarket extended its winning streak to a fourth straight session, with the ASX 200 lifting by 41.7 pts or 0.6 per cent to 7151.3 on Monday. This followed the S&P 500’s 2.25 per cent jump on Friday thanks to slowing US wage growth and the first contraction in the services sector since 2020. This encouraged shaky markets that last year’s significant rate hikes (+425bps in 2022) are cooling the American economy.
Our market was led higher on Monday by our major mining, energy, banks and retailer stocks. Paladin Energy (PDN), Nickel Industries (NIC) and South32 (S32) improved strongly.
Fortescue Metals (FMG) was an exception, losing 0.8 per cent after its long serving Chief Financial Officer (CFO) announced his resignation. Mr Ian Wells first joined the iron ore miner in 2010 and stepped into the CFO role in 2018.
Share registry company Computershare (CPU) fell 5.5 per cent after receiving a broker downgrade this morning. CPU has benefited from the rising interest rate environment as it helps boost margin income.
Insurers were mostly lower on Monday. IAG (IAG) – which operates NRMA – released a 2-page statement warning that reinsurance has grown more expensive partly due to a spike in bad weather events. IAG closed 0.4 per cent lower.
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Biotechnology firm Imugene (IMU) rose 3 per cent after it received ethics approval to start Phase I human clinical trials of a new therapy aimed at treating those with advanced solid tumour cancers.
Core Lithium (CXO) has decided to relocate its corporate head office from Adelaide to Perth by mid-2023. The lithium miner said this should ‘…provide Core with better access to mining service providers’.
Rare earth mineral company VHM Limited (VHM) made its ASX debut today, sliding 15.6 per cent. Its Gosche Project in Victoria is its flagship site.
While the ASX 200 has improved so far this month, it follows December’s 5.9 per cent tumble and 2022’s 5.45 per cent fall. The broad US S&P 500 index slumped by a more severe 19.4 per cent last calendar year. Two key risks for global markets this week will be US CPI (consumer inflation) data on Thursday night, together with the start of the US earnings season on Friday.
3.1 bn shares were traded on Monday worth $5bn. 859 shares rose, 500 fell and 434 finished unchanged.
Originally published by Steven Daghlian – Market Analyst (Author), CommSec
