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Record Chinese iron ore prices lifted Australia’s major miners while the benchmarks faded as Anzac Day holidays across much of the country dampened participation.
The S&P/ASX 200 hovered near break-even for much of the session before finishing at an intraday low, off 15 points or 0.2 per cent. Trading volumes were depressed by holidays in Queensland, South Australia, WA, the ACT and Northern Territory.
What moved the market
The big three iron ore producers provided much of the excitement on a day when the ASX never got out of first gear. Iron ore futures climbed as much as 6.3 per cent on the Dalian Commodity Exchange to a record high as steel futures hit fresh peaks. Steel rebars rallied 4.3 per cent on the Shanghai Futures Exchange.
Records fell as China continued to clamp down on steel production over environmental concerns. Reuters reported authorities taking a tougher approach in Shaanxi and Hebei.
“Iron ore prices are mainly supported by structural contradiction of supplies, there’s shortage in medium and high-grade products,” Zhuo Guiqiu, an analyst with Jinrui Capital, told the news agency.
Fortescue Metals climbed 4.8 per cent to a seven-week high. Rio Tinto rose 1.12 per cent. BHP added 0.59 per cent. Further down the food chain, Champion Iron advanced 3.09 per cent to a new record.
Macquarie Group hit an all-time high before easing 0.13 per cent. The investment giant has outperformed the wider market this year following a strong February operational briefing outlining windfall profits from a rebound in energy prices.
US futures inched higher ahead of a week that is expected to set the market tone for the next month. Wall Street’s six largest companies are due to report this week, along with four-tenths of the S&P 500. Dow futures rallied 32 points or 0.1 per cent. S&P 500 futures gained less than a point or 0.02 per cent.
Winners’ circle
The financial sector was Wall Street’s best performer on Friday, but the local giants struggled to follow suit. While NAB put on 0.76 per cent, CBA gave up 0.38 per cent and ANZ 0.03 per cent.
Westpac dipped after warning of a $282 million hit to cash earnings in next week’s first-half report. The bank said additional provisions for customer refunds, software write-downs and an accounting loss on a sale would be partly offset by gains in an investment in Coinbase and the sale of a holding in Z1P Co. The share price faded 0.16 per cent.
Health insurer NIB surged 10.2 per cent to a three-month high on news customer numbers increased by 3.7 per cent over nine months and claims were lower than expected. The company expects full-year underlying profit to increase to $200-$225 million.
The property boom helped lift real estate agent McGrath‘s half-year earnings to $6.6 million from $1.6 million for the prior corresponding period. The company said first-half momentum had continued into the new year. The share price jumped 6.15 per cent.
Perenti Global rallied 3.23 per cent after its North American subsidiary secured a letter of intent for work at Newcrest’s Red Chris Project in Canada. Perenti expects the contract to generate around $38 million over 16 months.
Integrated services provider Downer EDI climbed 0.56 per cent after selling its Otraco tyre management business to Bridgestone for $79 million. Aristocrat Leisure edged up 0.41 per cent
Doghouse
Buying interest in “reopening stocks” was depressed by the latest Covid-19 lockdown in WA. While the state recorded no new cases yesterday, some lockdown measures were extended today. Corporate Travel Management declined 3.3 per cent, Flight Centre 2.61 per cent, Webjet 0.96 per cent and Qantas 1.2 per cent.
Retailers also struggled. JB Hi-Fi slid 4.05 per cent, Kogan.com 4.12 per cent and Super Retail Group 2.53 per cent.
Traditional defensive value assets provided much of the down-pressure. Newcrest slid 2.61 per cent, Woolworths 0.85 per cent and Goodman Group 1.09 per cent. Wesfarmers shed 0.57 per cent, Coles 0.45 per cent and Telstra 0.88 per cent. Health giant CSL slipped 0.58 per cent.
Sigma Healthcare eased 1.45 per cent on news Mark Hooper will stand down as CEO and Managing Director after 11 years.
Other markets
A mixed session on Asian markets saw the Asia Dow advance 0.59 per cent, China’s Shanghai Composite retreat 0.4 per cent, Hong Kong’s Hang Seng shed 0.28 per cent and Japan’s Nikkei add 0.44 per cent.
Oil started the week on the back foot. Brent crude retreated $1.32 or 2 per cent to US$64.79 a barrel.
Gold nudged up $4.30 or 0.24 per cent to US$1,782.10 an ounce.
The dollar climbed 0.38 per cent to 77.72 US cents.
