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The share market claimed a fifth straight winning week as US futures edged higher ahead of tonight’s November jobs report.
The S&P/ASX 200 rose 19 points or 0.3 per cent today, extending its tally for the week to 33 points or 0.5 per cent. The index has put on 11.9 per cent in five weeks since the start of November. The market finished the week 50 points or less than 1 per cent below where it started the year.
What moved the market
The share market slumped on Monday and spent the rest of the week repairing the damage, finally turning positive yesterday. A rally built on post-US election optimism over the prospect of vaccines next year has slowed considerably over the last two weeks.
US stocks stuttered overnight after Pfizer surprised the market with news it will miss its vaccine production target for this year by half. The drugmaker said problems in the supply chain would reduce its 2020 production from 100 million doses to 50 million. The Dow slashed its gain to 0.29 per cent. The S&P 500 dipped 0.06 per cent into the red.
The damage proved short-lived: US futures recovered during Australian trading hours. S&P 500 futures were lately up seven points or 0.2 per cent. Tonight’s employment update is expected to bring further evidence that the jobs market is healing. Futures rose after President-elect Joe Biden indicated his support for a US$108 billion bipartisan stimulus package.
“I think it should be passed, and I think that, in fact, we’re going to need more,” Biden told CNN’s Jake Tapper. “I’m going to have to ask for more help.”
Winners’ circle
The big banks provided the early momentum before the mining majors threw their weight behind the rally. ANZ put on 1.3 per cent, NAB 0.7 per cent, CBA 0.8 per cent and Westpac 0.4 per cent. Macquarie Group gained 2.3 per cent.
Rio Tinto added to its highest finish since the GFC, climbing 0.9 per cent. BHP edged up 0.6 per cent to a ten-month peak. Fortescue eased 0.2 per cent from yesterday’s all-time high.
Shopping centre landlords rose after retail sales rebounded with Victoria’s emergence from lockdown hibernation. Sales improved 1.4 per cent in October, raising hopes for a strong festive shopping season. Scentre Group gained 1.1 per cent and Stockland 0.7 per cent. SCA Property Group added 0.4 per cent.
Energy stocks welcomed a counter-intuitive rise in crude after OPEC announced plans to lift production curbs in stages from next month. Analysts attributed the rally to relief that the cartel had settled on smaller increases than some members wanted. Woodside gained 0.7 per cent. Santos added 1.1 per cent.
Strong online sales and record Black Friday/Cyber Monday trading helped lift retail group Premier Investments 0.7 per cent. Chair Solomon Lew told today’s virtual AGM online sales increased 70 per cent over the first 18 weeks of the financial year compared to the same period last year.
Aged care operator Regis Healthcare finished flat after knocking back takeover offers from Washington H. Soul Pattinson and associates. Regis dismissed the bids as “opportunistic” and “inadequate”. Soul Pattinson gained 0.4 per cent.
Treasury Wine Estates continued to recover from China’s tariff hike, rising 3.7 per cent to a third straight gain.
Doghouse
Gold stocks struggled for a second day as investors favoured companies with better exposure to next year’s anticipated economic revival. Regis Resources shed 4.3 per cent, Resolute Mining 3.2 per cent and Newcrest 1.5 per cent.
Qantas slid 4 per cent as oil – a major input cost for airlines – rallied. Brent crude surged another 92 cents or 1.9 per cent today to US$49.64 a barrel.
Infrastructure specialist Cimic retreated 0.4 per cent from its strongest level since June after winning utilities contracts worth a combined $112 million.
Other heavyweights to miss today’s upswing were supply-chain logistics company Brambles -0.8 per cent and retail conglomerate Wesfarmers -0.6 per cent. Insurer IAG shed 0.6 per cent, Woolworths 0.3 per cent and CSL 0.1 per cent.
Other markets
A downbeat session on Asian markets saw China’s Shanghai Composite decline 0.4 per cent, Japan’s Nikkei 0.3 per cent and Hong Kong’s Hang Seng 0.2 per cent.
Gold climbed $3.70 or 0.2 per cent to $US1,844.80 an ounce.
The dollar receded 0.1 per cent to 74.29 US cents.
Hot today and not today
Hot today: Orthapaedics innovator Allegra (ASX:AMT) briefly tripled in value on positive test results on its flagship product for neck and back pain. The company’s revised Spinal Cage design passed regulatory testing without signs of fracture or failure. Allegra will now proceed with a pilot study on animals next month, the next step towards bringing the product to market. Allegra shares ran from 20 cents to 65 cents before finishing at 40 cents, a gain of 100 per cent.
Not today: Shares in betting software company BetMakers (ASX:BET) skidded after its bid for UK-based Sportech’s tote and digital business was complicated by a rival offer. Sportech announced it had received a conditional proposal from a third party to buy the company outright. BetMakers said it had a binding agreement with Sportech for the tote and digital business. BET shares slumped 11.3 per cent.
