Aussie shares opened with a bang this week as US futures and oil prices rise.
US Federal Reserve Chair Jerome Powell made the bold claim that unless a new wave of COVID-19 spreads, the worst of the economic blow from the virus has passed. He predicted the economy will improve steadily throughout the rest of the year, prompting a surge in futures. As it stands, Dow Jones futures are 1.06 per cent higher and S&P 500 futures 1.02 per cent higher.
Down under, our local share market fought off marginal losses from our big banks and closed a healthy shade of green. The benchmark ASX 200 index tacked on 1.03 per cent to close at 5460.5 points.
The financials sector was the only major drag on the market as our big four banks closed red. Westpac led the fall today, suffering a 2.29 per cent decline. ANZ was close behind with a 2.01 per cent fall while NAB lost 1.88 per cent. Commonwealth Bank lost 1.17 per cent.
However, the other pillar of our share market, the materials sector, shook off the bank’s losses and surged ahead. Rio Tinto led the gains among our big iron ore players, closing 5.79 per cent higher. Fortescue gained 5.82 per cent and BHP 4.52 per cent.
Gold stocks added their own weight to the win, with Saracen Mineral Holdings flexing a double-digit gain and closing 11.29 per cent higher. Newcrest gained 6.72 per cent, Evolution Mining 5.93 per cent, and Northern Star 3.99 per cent.
With an upswing in the price of crude oil once more, the energy sector joined in the fun. Woodside closed 2.02 per cent higher and Origin Energy 2.04 per cent higher, while Santos gained 5.87 per cent. Oil Search added on 5.63 per cent.
Even our ever-volatile technology sector had a win today, spurred on by WiseTech’s 5.69 per cent gain. Afterpay, now officially our biggest tech stock by market cap, gained 2.69 per cent. Xero, which has slipped into second place, gained 2.43 per cent. Computershare gained 1.38 per cent.
Over to the east, it was a mostly green day for Asian stocks outside of a marginal 0.03 per cent loss from the Asia Dow. When the ASX closed for the day, Japan’s Nikkei 225 was 0.76 per cent higher and Hong Kong’s Hang Seng was 0.42 per cent higher.
Meanwhile, the Aussie dollar is once again stronger against US currency but weaker against the Pound sterling. Currently, one dollar buys 64.27 US cents, 53.12 pence, and 11.91 South African Rand.
Today’s ups and downs
Theme park operator Village Roadshow (ASX:VRL) was the subject of a fresh takeover offer the BGH Capital today. In late 2019 and early 2020, BGH and Pacific Equity Partners (PEP) were in a bidding war over VRL shares, with offers reaching at high at $780 million. However, the COVID-19 crisis caused the closure of the famous Gold Coast theme parks and VRL cinemas — causing a massive slump in VRL’s share price. Today, BGH offered $2.40 per share for full control of VRL, valuing the company at $468.5 million. Shares in the company surged 20.68 per cent higher to close worth $2.13 each.
While it’s tough to pick out a loser on a day like today, mortgage insurance company Genworth Mortgage (ASX:GMA) remained the victim of analyst downgrades as the coronavirus strikes more blows to the employment and housing market. GMA shares closed 8.89 per cent lower at $2.05 each.