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The ASX 200 finished little changed after failing to sustain a push above 7000.
The Australian benchmark hit a seven-week high of 7021 in the first half hour before a session-long fade stripped its gains. The index finished a single point or 0.01 per cent in the red at 6975.
Advances in tech stocks, defensive assets and banks offset declines in energy and iron ore producers.
What moved the market
Positive overnight leads helped the market start with a spring in its step. The ASX 200 poked its head above 7000 for the second time in three sessions before being again repelled.
“Despite a strong session on Wall Street overnight, the ASX200 has failed to hold onto its early gains and cement a much-needed toehold above the psychologically important 7000 level,” Tony Sycamore, market analyst at City Index, said.
7000 acts as important ’round number’ technical resistance. It is also a level that provided important support during retraces earlier in the year when the index was approaching from the other direction. Support levels once broken become resistance.
Energy stocks were the biggest drag, falling 2.2 per cent after Brent crude slumped to a six-month low. The international benchmark settled US$3.76 or 3.7 per cent lower at US$96.78 a barrel overnight. US crude slid US$3.76 or 4 per cent to US$90.66.
The declines came amid weak demand signals from the US and after the OPEC+ cartel agreed to a slender increase in monthly production of 100,000 barrels. The US Energy Information Administration said US crude supplies increased by 4.5 million barrels last week at a time when national stockpiles were expected to fall.
US stocks rallied for the first time in three nights as upbeat corporate earnings and positive economic data soothed worries about the economy slowing.
The S&P 500 bounced 1.56 per cent. Trading updates from PayPal and Moderna helped lift the Nasdaq Composite 2.59 per cent to its highest finish since early May.
The ructions caused by US House Speaker Nancy Pelosi’s visit to Taiwan continued to die down. Hong Kong’s benchmark index, the Hang Seng, rallied 1.64 per cent this afternoon and has regained almost all of its losses since Tuesday’s temper tantrum. On the mainland, the Shanghai Composite firmed 0.42 per cent.
“A few hours on from Nancy Pelosi leaving Taiwan and markets have almost forgotten she ever came. Equity market have recovered their poise,” NAB’s head of FX strategy Ray Attrill said.
Winners’ circle
The tech sector touched its highest level since May as confidence continued to return after the sector lost almost half of its value in eight months. Afterpay’s US parent company Block surged 8.9 per cent ahead of tonight’s trading update.
Life360 rallied 9.58 per cent, Megaport 4.94 per cent and EML Payments 3.72 per cent.
Other growth stocks to shine included PointsBet +11.58 per cent, Imugene +10.87 per cent and Telix Pharmaceuticals +4.45 per cent.
Heavyweight movers included Telstra +1.27 per cent, toll road operator Transurban +0.41 per cent and property group Goodman +0.15 per cent. The high-street banks put on between 0.31 and 1.32 per cent.
Centuria Industrial REIT bounced 3.83 per cent as an 11 per cent increase in net tangible assets helped soften news of a 39.9 per cent slide in full-year net profit. The trust expects to pay a smaller distribution this fiscal year of 16 cents per unit, down from 17.3 cents in FY22.
An earnings upgrade boosted NRW Holdings 10.94 per cent. The mining contractor said it expected full-year earnings to be $157 million, ahead of previous guidance of $150-$155 million. The firm was sitting on record orders of $5.2 billion.
Fund manager Magellan shrugged off another month of net outflows, rising 1.57 per cent. Funds under management declined $2.5 billion in July.
Doghouse
Energy stocks retreated with Brent’s six-month low. Woodside gave up 3.05 per cent. Santos dropped 1.27 per cent. Beach Energy shed 1.11 per cent.
Bulk metal miners eased as Chinese iron ore prices fell 4.2 per cent this afternoon. Rio Tinto slid 1.55 per cent, Fortescue Metals 2 per cent and BHP 1.14 per cent.
Newcrest eased 0.99 per cent after water intrusion into a ventilation vent halted underground mining at the Cadia gold mine near Orange. The miner said surface activities remained operational and the interruption was not expected to impact full-year production.
Explosives group Orica fell 9.3 per cent to $15.60 after raising $650 million from institutional investors at $16 to help fund the acquisition of Axis Mining Technology.
A broker downgrade drove bottlo and hotel group Endeavour down 2.48 per cent. UBS reduced its rating from ‘Neutral’ to ‘Sell’, citing rises in operating costs and gaming taxes.
Other markets
Asian markets continued to regain losses earlier in the week triggered by tensions over Taiwan. The Asia Dow put on 0.69 per cent. Japan’s Nikkei gained 0.68 per cent.
US futures eased after last night’s sharp move higher. S&P 500 futures dipped four points or 0.1 per cent.
Oil added to last night’s loss. Brent crude eased 11 US cents or 0.1 per cent to US$96.67 a barrel.
Gold rebounded, rising US$12.60 or 0.7 per cent to US$1,789 an ounce.
The dollar firmed 0.4 per cent to 69.64 US cents.
