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The share market clung on to a fourth straight gain at the end of its best week in a month following news of a record surge in US employment.
The S&P/ASX 200 put on 68 points in early action, but lost momentum mid-morning to reach the halfway mark just three points or 0.1 per cent ahead at 6036. A close around that level would deliver a weekly return of more than 130 points or around 2 per cent. The index closed above 6000 yesterday for the first time in three weeks and briefly cracked 6100 this morning before the rot set in.
The mood on world markets has improved as upbeat economic data and massive stimulus inflows helped dampen worries about surging coronavirus cases. The S&P 500 in the US rallied 14 points or 0.45 per cent overnight on news of a record rise in payrolls last month as 4.8 million Americans returned to work. Stocks closed below their session highs as traders closed the books before the Independence Day long weekend.
Hearing aid specialist Cochlear led the Australian advance. An announcement that the company had obtained US regulatory approval for four new products lifted Cochlear shares 5.2 per cent to their highest level since late March. Cochlear said the new products would be released in the next few months.
The announcement appeared to inspire the entire health sector. CSL put on 2.1 per cent, Fisher & Paykel Healthcare 1.1 per cent and Sonic 0.9 per cent.
Mum and dad favourite Telstra climbed 2.9 per cent to its strongest level in 15 weeks. Supermarkets Woolworths and Coles rose 0.8 per cent and 0.5 per cent, respectively.
BHP and Commonwealth Bank provided the bulk behind the up-move. BHP rose 0.5 per cent, offsetting a 1.4 per cent dip in Rio Tinto after the latter updated investors on plans for its Oyu Tolgoi mine in Mongolia. CBA added 0.4 per cent. Westpac dropped 0.3 per cent, ANZ 0.4 per cent and NAB 0.9 per cent.
Speculators who got caught up in this week’s extraordinary quadruple-digit percentage surges in Dorsavi, Aterity Therapeutics and Etherstack endured a difficult morning. Dorsavi sank 14.3 per cent to 4.2 cents, a far cry from yesterday’s peak of 27 cents. Aterity fell 18 per cent to 5 cents, roughly an eighth of Wednesday’s peak of 42 cents. Etherstack, which topped out at $3.70 on Wednesday, fell 8 per cent to $1.15.
Retail sales rebounded a record 16.9 per cent in May, according to final figures released this morning by the Australian Bureau of Statistics. The rebound reversed most of April’s 17.7 per cent plunge as cafes and restaurants started to reopen and stuck-at-home Australians splurged on clothing and footwear.
The mood on Asian markets was positive. China’s Shanghai Composite firmed 1.4 per cent, Hong Kong’s Hang Seng 0.5 per cent and Japan’s Nikkei 0.4 per cent. S&P 500 index futures dipped five points or 0.2 per cent ahead of tonight’s market holiday.
Oil gave up almost a fifth of yesterday’s gains. Brent crude retreated 21 cents or 0.5 per cent to $US42.93 a barrel. Gold slipped $2.20 or 0.1 per cent to $US1,787.80 an ounce.
The dollar edged up 0.04 per cent to 69.25 US cents.
What’s hot today and what’s not:
Hot today: Shares in Advanced Braking Technology (ASX:ABV) briefly quadrupled after the brakes specialist announced a deal with French aerospace, defence and transportation giant Thales. ABT will manufacture and supply a hill-hold park brake mechanism for Thales’ armoured patrol vehicles for the Australian Defence Force. Thales’ Australian subsidiary was contracted by the federal government to supply 1,100 Hawkei PMV-L vehicles. ABV’s share price shot from 2.5 cents to 13.5 cents and was lately ahead 48 per cent at 3.7 cents.
Not today: The death of a business partnership after almost half a century cost building supplies firm Adbri (ASX:ABC) a quarter of its market value this morning. Aluminium giant Alcoa dropped Adbri subsidiary Cockburn Cement as its lime supplier, ending a relationship that has lasted almost 50 years, according to Adbri CEO Nick Miller. The contract, worth around $70 million in revenue to Adbri (formerly Adelaide Brighton), will end in June next year. The company said it was not yet possible to quantify the financial impact of the contract loss. The share price fell as low as $2.27 before trimming its loss to 25 per cent at $2.36.
