A broad rally carried the share market towards a second day of gains at the end of a challenging month for investors.
All 11 sectors rose as the S&P/ASX 200 put on 58 points or 0.79 per cent. The advance trimmed the index’s loss for April to around 85 points or 1.1 per cent.
Tech stocks outperformed in line with overnight action in the US. The healthcare sector was held back by disappointing updates from ResMed and Ramsay.
What’s driving the market
A relief rally that commenced yesterday continued into a second session following a sharp bounce on Wall Street. The Nasdaq Composite surged 3.06 per cent overnight after Facebook owner Meta Platforms hurdled low expectations for its quarterly result. The S&P 500 gained 2.47 per cent.
“The Australian share market seems to be replicating the trend seen on Wall Street last night, exhibiting strong gains driven by technology shares,” Kunal Sawhney, CEO of research group Kalkine, said.
“Strong results from Meta Platforms have lifted market sentiments towards growth and technology shares, which have largely remained under pressure this year amidst surging interest rate hike expectations.
“ASX energy stocks also appear to be having a pleasant day on the back of a recent jump in oil prices. The prices of oil rallied on reports that Germany is no longer against an embargo on Russian oil. Concerns loom that this could further tighten supplies in the already tense global crude oil market.”
The market retained most of its initial gains in the face of a sharp deterioration in US equity futures. Nasdaq futures slumped 1.1 per cent following poorly-received after-market trading updates this morning from Apple and Amazon. S&P 500 futures fell 0.45 per cent.
Apple shares slid 2.22 per cent in extended trade after the company warned of supply-chain cost pressures. Amazon‘s firstly quarterly loss in seven years sent the share price down 9.02 per cent.
Growth stocks provided most of the morning’s best performers. PointsBet gained 10.7 per cent, Telix Pharmaceuticals 7.35 per cent and Imugene 7.14 per cent. Zip Co added 6.16 per cent, EML Payments 5.57 per cent and Life360 4.72 per cent.
Miners also featured. Uranium miner Paladin gained 7.14 per cent. Lithium miners Pilbara Minerals and Allkem added 6.13 and 3.57 per cent, respectively.
Seventeen of the 20 market leaders of the ASX 20 index advanced. Gains ranged from 0.28 per cent (CBA) up to 3.62 per cent for Aristocrat Leisure. Goodman put on 2.06 per cent, James Hardie 1.92 per cent and Coles 1.73 per cent.
ANZ announced it will take a charge of $43 million against its first-half result to account for divestments, business closures and taxes. The share price improved 0.63 per cent.
Gas and oil giants Woodside and Santos gained 0.32 and 0.57 per cent, respectively. Beach Energy firmed 1.1 per cent.
Improving energy prices helped propel Origin Energy up 2.46 per cent to a pandemic-era high. The company said revenues from gas last quarter were more than double last financial year. Electricity sales volumes were 7 per cent higher than the same time last year.
Rival AGL climbed 1.77 per cent.
Margin pressure, supply-chain issues and increased costs marred ResMed‘s trading update. The sleep apnea specialist boosted revenues by 12 per cent and operating profit by 5 per cent last quarter. The share price slumped 5.83 per cent on news margins contracted, chip shortages will dent full-year revenues and expenses increased by 21.1 per cent.
Takeover target Ramsay Health Care eased 0.44 per cent on a Covid-fuelled slump in profit. Unaudited net profit dropped 38.9 per cent to $201.6 million across the nine months to the end of March. Managing Director Craig McNally said the private-hospital business saw “significant levels of disruption in the business due to high rates of COVID in the community”.
Kogan skidded 11.23 per cent to a two-year low on confirmation a Covid-fuelled boom in online shopping continued to fade. The retailer’s gross sales declined 3.8 per cent to $262.1 million last quarter. Shares that traded as high as $25.57 in 2020 hit $3.95 this morning.
Asian markets were mixed. The Asia Dow advanced 0.12 per cent, China’s Shanghai Composite 0.19 per cent and Japan’s Nikkei 1.75 per cent. Hong Kong’s Hang Seng declined 0.79 per cent.
Oil pared overnight gains. Brent crude dropped 36 US cents or 0.3 per cent to US$106.90 a barrel.
Gold climbed further from a two-month low. The yellow metal rallied US$10.30 or 0.54 per cent to US$1,901.60 an ounce.
The dollar firmed 0.11 per cent to 71.17 US cents.