Join our daily newsletter At The Bell to receive exclusive market insights
The ASX shook off early weakness as gains in bank and health stocks offset declines in miners as China ramped up its crusade against soaring commodity prices.
The S&P/ASX 200 finished 16 points or 0.22 per cent ahead after falling as much as 15 points late morning after Victoria announced two new suspected Covid cases.
CSL, Wesfarmers and the big four banks advanced. Gold stocks were boosted by a five-month high in the metal. Other miners retreated as iron ore, steel and aluminium fell in China.
What moved the market
A resilient market battled a number of headwinds to a third straight win. The Victorian government announced late afternoon it had found a cluster of four “likely positive cases” of Covid-19 in the northern suburbs, raising fears of another lockdown. Volatility in cryptocurrency markets continued following a weekend plunge. The market also had weak leads following a mixed close on Wall Street on Friday.
Commodity prices retreated further from record levels after China’s National Development and Reform Commission summoned mining chiefs to a weekend meeting. In a statement afterwards, the commission warned of harsh penalties for speculation, hoarding and spreading fake news.
“With policy risk shifting toward government intervention, prices will surely be affected by market sentiment,” Li Ye, an analyst at Shenyin Wanguo Futures, told Bloomberg. “The rapid surge in commodity prices have badly affected manufacturers and market orders, leading to losses and defaults.”
Bloomberg reported iron ore dropped 4.5 per cent this morning. Steel rebars fell 3.7 per cent. Here, Fortescue Metals slid 4.17 per cent, Rio Tinto 2.15 per cent and BHP 1.84 per cent.
Buying interest beyond the mining sector was sharpened by a rise in US futures as Bitcoin and other digital coins pared weekend losses. S&P 500 futures climbed nine points or 0.23 per cent. Bitcoin was last up 4.43 per cent at US$35,287 after falling as low as US$31,228 overnight.
The Nasdaq Composite dropped 0.48 per cent on Friday as a second round of crypto ructions flared up. The S&P 500 eased 0.08 per cent. Strong manufacturing data helped lift the Dow 0.36 per cent.
Winners’ circle
CBA rose as high as $99.16, an all-time high, before trimming its advance to 0.72 per cent at $98.76. ANZ put on 0.57 per cent, NAB 0.68 per cent and Westpac 1.29 per cent.
Healthcare giant CSL climbed 1.75 per cent to a three-month peak. A broker upgrade from JP Morgan lifted ResMed 3.5 per cent. Wesfarmers added 0.96 per cent.
Gold miner Newcrest improved 2.66 per cent as the yellow metal resumed its ascent following Friday’s pause in a six-session rally. Gold rallied $9.40 or 0.5 per cent this afternoon to US$1,886.10 an ounce. Gold Road Resources added 5.82 per cent, Ramelius 3.98 per cent and Silver Lake Resources 4.99 per cent.
Northern Star climbed 1.07 per cent after announcing Michael Chaney will take over as non-executive chair on July 1. Chaney is a former chair of NAB and Woodside Petroleum and current chair of Wesfarmers.
Embattled data analytics firm Nuix rose 3.12 per cent after announcing boardroom changes in response to market feedback. The company said it will appoint additional independent directors and set up an independent sub-committee to work with external advisors on risk management. The firm’s shares hit an all-time low last week.
Freedom Foods rallied 3.49 per cent after raising $265 million to pay down debt and help recapitalise the company. The cereal and snacks firm was hit by class actions last year and this year alleging breaches of the Corporations Act and consumer law.
Z1P Co‘s global expansion plans accelerated with news the company will acquire the remaining shares in European BNPL provider Twisto Payments and UAE-based Spotii Holdings. The transactions will cost around $160 million. Shares in the company rose 0.85 per cent.
Aristocrat Leisure inched up 0.12 per cent after reporting an 11.8 per cent rebound in half-year profits as digital revenue accelerated and casinos, clubs and pubs reopened for business. Unfavourable currency movements helped knock group revenue down 1 per cent to $2.2 billion. On a constant currency basis, revenue increased by 10.7 per cent.
Online retailer Kogan bounced 14.71 per cent from Friday’s 12-month low.
Doghouse
The biggest drags outside of the miners were Macquarie Group -1.39 per cent and Afterpay -1.19 per cent. The heaviest falls on the wider market were Oz Minerals -4.6 per cent, AMP -3.56 per cent and Deterra -3.45 per cent.
Agribusiness Elders fell 2.39 per cent as it traded without the right to a dividend.
Other markets
Most Asian markets reversed losses as the session progressed. The Asia Dow inched up 0.09 per cent, China’s Shanghai Composite 0.07 per cent and Japan’s Nikkei 0.25 per cent. Hong Kong’s Hang Seng more than halved its loss to 0.38 per cent.
Oil prices rose as a storm developed in the Gulf of Mexico. Brent crude climbed 41 cents or 0.62 per cent to US$66.85 a barrel.
The dollar bounced 0.15 per cent to 77.24 US cents.
