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Australian shares crept higher ahead of Chinese GDP data as gains in consumer and energy stocks offset weakness in miners and REITs.
The S&P/ASX 200 overcame an early wobble to edge up nine points or 0.12 per cent by mid-session.
A well-received trading update lifted Wesfarmers 2.2 per cent. Other notable gainers included Woolworths, CSL and Woodside Petroleum. Bulk metal producers eased with iron ore and copper.
What’s driving the market
The trading week got off to a sluggish start with US trading desks closed for a long weekend and local traders exercising caution ahead of a lunchtime Chinese economic data dump.
The update from Australia’s biggest trading partner was expected to show the Chinese economy grew at the weakest pace since the pandemic-affected second quarter of 2020. Fourth-quarter gross domestic product was tipped to slow to a year-on-year gain of 3.6 per cent from 4.9 per cent in Q3.
China’s economy was hamstrung by Covid lockdowns and a severe property downturn. House prices fell for a fourth month in December, according to a report this morning.
ASX trading volumes were constrained by a long weekend on Wall Street for tonight’s Martin Luther King Jr public holiday. Wall Street finished mixed ahead of the holiday. The tech-heavy Nasdaq put on 0.59 per cent while the Dow fell 0.56 per cent. The S&P 500 edged up less than 0.1 per cent.
Going up
Wesfarmers rallied 2.22 per cent after confirming half-year profit will be in line with expectations. The retail conglomerate expects to report net profit after tax of $1.18-$1.24 billion for the half.
“Pleasing” results from Bunnings and Wesfarmers Chemicals, Energy & Fertilisers helped offset Covid-related disruptions and costs at Kmart and Officeworks. Trading conditions improved in the second quarter before weakening this year as the Omicron wave dampened foot traffic.
Adbri jumped 7.53 per cent after securing an extension to supply quicklime to Alcoa for another year. The supply deal will run from January 31 until the same date next year and be worth $25-$35 million in revenue to Adbri.
Pendal Group bounced 7.2 per cent off a 21-month low on news experienced boardroom operator Deborah Page will replace James Evans as Chair. Ben Heap will join as an independent non-executive director.
A 6 per cent increase in funds under management (FUM) last quarter lifted Australian Ethical 2.88 per cent. The asset manager increased FUM to $6.94 billion, thanks to strong net flows and investment performance.
Clinuvel edged up 1.63 per cent after completing enrolment for a Phase II study into a treatment for strokes.
Aside from Wesfarmers, the best of the heavyweights were Aristocrat Leisure +1.64 per cent, Woodside Petroleum +1.33 per cent, Woolworths +1 per cent and CSL +0.49 per cent.
The banks were mixed. ANZ put on 0.42 per cent, CBA 0.2 per cent and Macquarie Group 0.29 per cent. NAB dipped 0.19 per cent and Westpac 0.09 per cent.
Going down
South32 declined 2.99 per cent after announcing the Taylor Deposit at the Hermosa project in the US will progress to a feasibility study. A pre-feasibility study confirmed the zinc-lead-silver deposit’s potential to be the first development of a proposed multi-decade operation.
Centuria Industrial REIT announced the purchase of six industrial assets in Sydney, Melbourne and Brisbane to service demand from ecommerce operators. The additions have a combined value of $132.4 million. The share price slipped 0.51 per cent during a generally soft session for property stocks.
A down-tick in iron ore helped pull the big three ore miners off multi-month highs. Fortescue Metals retreated 1.64 per cent, Rio Tinto 0.49 per cent and BHP 0.88 per cent.
A glum morning for IPOs saw the newly-listed Beforepay dive 39.3 per cent and Vertex Minerals shed 12.5 per cent.
The session’s biggest falls were gold miner Perseus -4.27 per cent, uranium miner Paladin -3.98 per cent and building materials manufacturer CSR -3.43 per cent.
Other markets
A tentatively positive morning on Asian markets saw the Asia Dow add 0.07 per cent, China’s Shanghai Composite 0.02 per cent, Hong Kong’s Hang Seng 0.03 per cent and Japan’s Nikkei 0.89 per cent.
US futures drifted in holiday-affected trade. S&P 500 futures were recently off five points or 0.1 per cent.
The bull run in oil showed no signs of slowing. Brent crude rose 47 US cents or 0.55 per cent to US$86.55 a barrel.
Gold faded US$3.60 or 0.2 per cent to US$1,812.90 an ounce in electronic trade.
The dollar faded 0.2 per cent to 72.01 US cents.
