A record high in tech stocks helped the share market extend its stealth rally into a fourth session.
The S&P/ASX 200 edged up two points or less than 0.1 per cent to 5956, extending its tortoise-paced winning run. The index has put on 20 points in four sluggish sessions since last Thursday.
The market has lost momentum over the last two weeks as investors weigh rising coronavirus infections against evidence of economic recovery. The index lost its grip on 6000 almost two weeks ago and has struggled to regain it, hitting 5999.2 yesterday before a mid-session scare about the US-China trade deal sparked a dramatic sell-off, followed by a tepid partial recovery.
US stocks continued to march higher overnight, but finished near session lows after White House health adviser Dr Anthony Fauci warned of a “disturbing surge” in COVID-19 infections in parts of the US. The S&P 500 gained 13 points or 0.43 per cent. S&P 500 index futures were lately flat after an up-down morning.
Tech stocks outperformed in the US, setting up their Australian counterparts for a positive session. The sector became the first to regain all of its losses since the start of the pandemic, climbing 1.5 per cent to a record as Appen and Afterpay hit fresh peaks. Artificial intelligence specialist Appen put on 3.1 per cent and buy-now-pay-later leader Afterpay 1.4 per cent. Nanosonics gained 3.3 per cent, Nextdc 3.1 per cent and Altium 2.1 per cent.
Mining and select defensive sectors provided support, offsetting declines in industrials, energy and financial stocks. Gold miner Newcrest put on 2.1 per cent, health giant CSL 0.9 per cent, BHP 0.2 per cent and property group Goodman 0.2 per cent. Transurban sank 1.8 per cent, Woodside 0.9 per cent, Westpac 0.8 per cent, NAB 0.4 per cent and ANZ 0.3 per cent. The Commonwealth Bank edged up 0.2 per cent.
Gold miners sparkled after the precious metal touched its highest level since 2012. The precious metal continued to rise this morning, lately up $5.10 or 0.3 per cent at $US1,787.10 an ounce. Perseus rose 8 per cent, Evolution Mining 4.1 per cent and Silver Lake 3.5 per cent. At the other end of the index, Seven West Media eased 5 per cent, Viva Energy 3.7 per cent and AMP 3.5 per cent.
Sonic Healthcare climbed 4.2 per cent after updating shareholders on its operations. The pathology specialist expects underlying earnings before interest and tax for this financial year to be roughly in line with last year, thanks to an improvement in volumes last month after a dire March and April.
Village Roadshow slid 1.1 per cent after announcing the partial reopening of its Gold Coast theme parks. The Queensland government gave the company a green light to reopen Sea World and Paradise Country on Friday at 50 per cent capacity, with others to follow in stages next month.
Asian markets were subdued. China’s Shanghai Composite gained 0.2 per cent, Hong Kong’s Hang Seng dipped less than 0.1 per cent and Japan’s Nikkei gained 0.1 per cent.
Oil extended overnight falls. Brent crude drifted 22 cents or 0.5 per cent this morning to $US42.41 a barrel.
The dollar advanced 0.35 per cent to 69.53 US cents.
What’s hot today and what’s not:
Hot today: Venture builder Strategic Elements (ASX:SOR) hit a five-month high this morning on news its robotics subsidiary was working on a prototype airborne drone to complement its robotic vehicle platform. The project is part of a program backed by the Australian Department of Defence. The drones have potential applications in the defence, security and resources sectors. A prototype is expected to be completed early in the fourth calendar quarter. SOR’s share price jumped 23.1 per cent.
Not today: The morning’s most intriguing company announcement left more questions than answers, but triggered one of the biggest falls. Health-food company Freedom Foods (ASX:FNP) announced Chief Financial Officer and Company Secretary Campbell Nicholas had resigned and Managing Director and CEO Rory Mcleod was going on leave “pending a further announcement that is expected to be made early next week”. Brendan Radford will take over as Acting CEO. Stephanie Graham will step into the role of Acting CFO. Shareholders read between the lines and voted with their feet, sending the share price down 13.4 per cent to a four-and-a-half-year low.