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Aussie stocks edged higher for a fifth session as surges in US index futures and Asian markets offset concerns about a new daily record in coronavirus cases.
The S&P/ASX 200 overcame a soft start to advance 12 points or 0.2 per cent by mid-session. The index fell as much as 26 points in early action before reversing with US index futures.
S&P 500 futures advanced 10 points or 0.3 per cent as Wall Street prepared to reopen after the Independence Day market holiday. This year’s July 4 celebrations were dampened by news COVID-19 infections rose in 39 out of 50 states. Reuters reported many towns and cities cancelled firework displays to prevent large gatherings.
Asian markets shrugged off a World Health Organization warning that some countries may have to lock down once again after the daily total of new cases reached a new record. In Australia, the NSW-Victoria border will close at midnight tomorrow after Victoria recorded its highest ever daily increase in new cases, surpassing the March peak. China’s Shanghai Composite jumped 3.4 per cent, Hong Kong’s Hang Seng 2.3 per cent and Japan’s Nikkei 1.4 per cent.
On the ASX this morning advances in tech stocks, Telstra and select defensive sectors offset declines in mining, industrial and health stocks. The Afterpay juggernaut climbed for the fifth time in six sessions, rising 1 per cent. Investors who bought the March low have seen their investment multiply by six in less than four months. Elsewhere in the tech sector, WiseTech rose 4.5 per cent, Iress 2.3 per cent and Technology One 2.1 per cent.
Telstra and supermarket Coles climbed 0.9 per cent to their highest level in almost four months during a solid morning for defensive assets. Woolworths edged up 0.5 per cent, GWA Group 5.2 per cent, SCA Property Group 2.2 per cent and Spark Infrastructure 1.6 per cent.
Small caps outperformed the broader market. The Small Ords advanced 1.2 per cent compared to a 0.2 per cent rise for the All Ordinaries.
Among the market heavyweights, BHP fell 0.7 per cent, Rio Tinto 0.4 per cent, health giant CSL 1.1 per cent and Wesfarmers 0.1 per cent. The big four banks advanced between 0.4 and 0.7 per cent.
Mesoblast was the morning’s best performer, gaining 8.3 per cent on news that the US regulators had made it easier for patients to access the company’s treatment for COVID-19-infected children with heart problems and other inflammatory conditions. Other notable gainers included Ooh!Media +7.1 per cent, NRW Holdings +6.2 per cent and Seven West Media +5.7 per cent.
Building materials supplier Adbri sank 5.3 per cent to a three-month nadir following Friday’s announcement that a subsidiary had lost a contract worth $70 million per annum. Bega Cheese fell 3.4 per cent and Bluescope Steel 2.4 per cent.
A record rebound in job advertising helped market sentiment. ANZ’s measure bounced 42 per cent last month as the economy cranked back into life. Despite the recovery, ad volumes remained more than 40 per cent weaker than February’s pre-pandemic reading.
Oil began the week on the front foot. Brent crude improved 13 cents or 0.3 per cent this morning to $US42.93 a barrel. Gold faded $8.60 or 0.5 per cent to $US1,781.40 an ounce.
The dollar rose 0.3 per cent to 69.57 US cents.
What’s hot today and what’s not:
Hot today: Today’s spec rocket stock was Redstone Resources (ASX:RDS) , whose share shot from eight-tenths of a cent to six cents after the explorer found copper sulphides at its West Musgrave Project in WA. Reverse circulation drilling intersected 95 metres of continuous anomalous copper near the surface, according to Chairman Richard Homsany. The interval also included trace amounts of gold. Some of the heat later came out of Redstone’s share price, trimming its gain to 175 per cent at 2.2 cents.
Not today: The rollercoaster ride for investors in Chase Mining (ASX:CML) continued with a downward lurch after the first drill-hole at the company’s Lorraine Mine gold prospect did not produce visible gold. The share price more than doubled to 4.8 cents last week on news the company intersected massive sulphides at its Alotta copper-nickel project. Alas, in this fickle market you are only as good as your last hit. The share price tanked 20.6 per cent to 2.7 cents this morning as investors cast a sceptical eye over the “encouraging” Lorraine data.
