Signs the post-election party will continue tonight in the US helped catapult the ASX up more than 1.7 per cent to an eight-month high.
Technical traders clambered aboard as the S&P/ASX 200 broke through a resistance level that had held firm against repeated assaults since June.
With fiscal and central bank stimulus packages in place and the US election more or less settled, the local benchmark surged 109 points or 1.75 per cent to 6299. The index last traded that high in the second week of the February-March pandemic plunge.
What moved the market
The rally built steadily from the open as US index futures signalled relief the election finally had a winner. President Donald Trump has yet to concede, but the verdict from the major US networks was clear: Joe Biden will be the 46th president of the United States after securing more than 270 electoral college votes.
S&P 500 futures soared 61 points or 1.7 per cent. Dow futures rose 390 points or 1.4 per cent.
Trump’s accusations of electoral fraud fell on mostly deaf ears as a succession of world leaders congratulated the challenger on his victory. Former supporters urged Trump to stand down with dignity.
“There comes a time in the battle when one should fold the tent,” billionaire investor Bill Ackman tweeted: “Concede graciously and call for unity.”
Resource stocks led a broad rally that lifted every sector except utilities (-0.2 per cent). With investors hoping for an infrastructure-led US recovery, Fortescue Metals soared 6.4 per cent and Rio Tinto 2.9 per cent. BHP advanced 3.5 per cent after increasing its oil footprint. The Big Australian secured an additional 28 per cent working interest in the Shenzi development in the Gulf of Mexico for US$505 million. The transaction adds around 11,000 barrels a day to BHP’s production.
Eighteen of the market heavyweights of the ASX 20 advanced. Insurer IAG climbed 3.3 per cent, Wesfarmers 2.3 per cent, Telstra 2.1 per cent, Coles 1.5 per cent and CSL 1 per cent. Property giant Goodman finished 1.6 per cent ahead after trading above $20 for the first time since June 2008.
NAB was the best of the banks, rising almost 1 per cent. Macquarie Group put on 0.7 per cent after launching a $300 million bid for Vitalharvest Freehold Trust, an ASX-listed entity that owns berry and citrus farms. CBA edged up 0.75 per cent.
Investors in Crown Resorts finally had something to cheer following accusations at a NSW inquiry that the gambling group was unfit to hold the licence for its new Barangaroo casino in Sydney. Shares in the company climbed 3.6 per cent after the Victorian Government approved the resumption of trade at its Melbourne casino from Thursday.
Cinema and theme park operator Village Roadshow climbed 2.6 per cent after the board recommended shareholders accept a revised offer from private equity firm, BGH Capital. Nine Entertainment lifted 2.2 per cent after securing the rights to broadcast Wallabies Test matches for three years. The deal is worth around $100 million. The media group also announced the launch of sports streaming package branded Stan Sports.
REA Group benefitted from a pair of broker upgrades, soaring 9.1 per cent to an all-time high. A strong session for real estate advertisers saw Domain Holdings gain 5.5 per cent.
ANZ Banking Group was the biggest drag on the index, sliding 1.9 per cent as it traded without its dividend. Westpac dipped 0.1 per cent.
Tabcorp skidded 2.9 per cent after a fire at data centre shut down its TAB, Keno and gaming services over the weekend. The gambling group said services had been mostly restored.
The prospect of a costly, drawn-out battle with the tax office weighed on medical support services provider Healius. The company announced it will take its battle over the tax treatment of payments to GPs to the High Court. Shares sank 2.2 per cent.
The utilities sector retreated as investors chased assets with better exposure to a share market rally. APA Group fell 0.2 per cent, AGL Energy 0.3 per cent.
Japan’s Nikkei 225 climbed 2.3 per cent to its highest level since November 1991. China’s Shanghai Composite added 1.9 per cent and Hong Kong’s Hang Seng 1.6 per cent.
Oil rebounded from Friday’s 3.6 per cent slump. Brent crude rose $1.07 or 2.7 per cent to $US40.52 a barrel.
Gold built on Friday’s seven-week high, advancing $12.50 or 0.6 per cent to $US1,964.20 an ounce.
The dollar hovered just below 73 US cents, lately up 0.06 per cent at 72.91 US cents.
Hot today and not today
Hot today: Progress towards a treatment for E. Coli infections boosted shares in biotech Immuron (ASX:IMC). The biotech’s shares climbed 25.3 per cent on news an experimental vaccine produced antibodies in a trial on cows. The trial had the support of the US Department of Defense, which is seeking treatments for troops serving overseas.
Not today: Investors appeared underwhelmed by the latest drilling results from Alkane Resources‘ (ASX:ALK) Boda gold-copper prospect in central NSW. Shares than had more than doubled since March dropped 9.8 per cent despite the company’s attempts to talk up the results. “The Boda Prospect just keeps getting bigger and bigger,” Managing Director, Nic Earner, said. “We have extended the mineralisation to the north and, to the south, we have either an extension or a whole new system emerging. We believe Boda is shaping up to be a large, tier one gold-copper porphyry project.”