Australian shares are on track to close lower for its fourth week despite a risk on mode lifted by information tech. A much welcomed reprieve after yesterday’s 8.7 per cent tumble as investors continue to sell out of long duration stocks ahead of a lift in interest rates to curtail inflation.
At noon, the S&P/ASX 200 is 1.5 per cent or 103 points higher at 7,044. The SPI futures are pointing to a rise of 112 points.
The local index is having its best day in 3.5 months amid the Nasdaq futures pointing to a rise of 0.9 per cent. The rebound comes after one of the worst days this year, notching a dive of 9 per cent in the past three weeks with the fall hitting a 3 month low of 6,930.
Consumer discretionary follows after information tech in a broad based rally, up 2.6 per cent and energy, adding 2.3 per cent. Utilities is adding the least, up 0.1 per cent.
Who are the winners?
Afterpay owner Block (ASX:SQ2) is soaring 12.3 per cent to $112.14 while Link Administration (ASX:LNK) is surging 9.6 per cent to $4.45 as the third-best performer. It appears that investors have found appetite, following its massive 13 per cent fall the other day despite a report by Deloitte concluding that the proposed acquisition by Dye & Durham was fair and reasonable.
BHP Group (ASX:BHP), the largest company on the index is up 1.3 per cent to $45.52. Rio Tinto (ASX:RIO) is trading 1 per cent higher to $104.43, while Fortescue Metals (ASX:FMG) gaining 0.7 per cent at $19.14.
Santos (ASX:STO) is leading the energy circle, up 2.6 per cent to $8.01, followed by Woodside Petroleum (ASX:WPL) jumped 2.4 per cent at $30.31.
On the other hand, gold stocks are lower, led by Newcrest Mining (ASX:NCM) down 1.5 per cent to $24. Evolution Mining (ASX:EVN) has fallen 1.2 per cent to $3.4134 and Northern Star (ASX:NST) is trading 0.3 per cent lower at $8.47.
Major banks are higher, led by Macquarie Group (ASX:MQG) up 3.8 per cent to $181.90, while Commonwealth Bank of Australia (ASX:CBA) is shedding the least, up 0.2 per cent to $102.34.
Telstra (ASX:TLS) is up 1.8 per cent, and Sayona Mining (ASX:SYA) jumping 6.8 per cent with heavy volumes seen.
Beijing denies lockdown rumours as restrictions tighten
In Asian markets, Beijing officials denied it was heading for lockdown as panic buying gripped the capital on Thursday. Rumours were sparked by latest tightening measures involving suspension of taxi services in some virus-hit districts. Officials denied rumours of a lockdown and told people not to panic-buy, but also encouraged residents to stay home and said they would launch a new round of mass testing across most of the city.
The news hasn’t weighed on the commodities complex yet, however uncertainties lie as to how long these extended measures will last. Despite what is happening in China, global markets are under supplied with analysts saying that the oil market will get tighter as China starts to ease its lockdowns. The world’s second largest economy is one of the largest consumers of commodities, buying around 70 per cent of global iron ore, almost half of the other base metals and consumer around 15 per of the world’s oil supply.
Local economic news
Western Australia is one of just two states to see an increase in new home sales in April, recording a significant increase in the amount of new activity from the same period prior to the Covid-19 pandemic, according to The Housing Industry Association.
Here’s Lauren with the top headlines
Pro-Pac Packaging (ASX:PPG) has cut its FY22 guidance due to supply chain disruptions, labour shortages and Covid-19. It now expects underlying profit after tax to be around $5 million. Shares are trading 14.2 per cent lower at $1.15.
Software company Bigtincan (ASX:BTH) has signed a partnership with Oracle to join the Oracle PartnerNetwork. Bigtincan said the program allows for new tech offerings on the Oracle Cloud and sales reps to view client information, as well as create custom presentations and send data to Oracle systems for updates. Shares are trading 8.7 per cent higher at $0.56.
Primobius, a 50:50 joint venture between Neometals’ (ASX:NMT) and SMS Group, has executed a binding agreement with LICULAR, a subsidiary of Mercedes-Benz. Under the agreement, Primobius will supply equipment and engineering to a LICULAR Recycling Plant, for battery recycling and waste disposal, which is set to be located in Germany. Shares in Neometals’ (ASX:NMT) are trading 8.9 per cent higher at $1.34.
Buru Energy (ASX:BRU) has named Thomas Nador as its new chief executive officer, starting no later than September 1. Thomas is currently group executive, development at Beach Energy, based in Perth. Shares are trading 6.3 per cent higher at $0.17.
Property giant Goodman Group (ASX:GMG) has appointed New York-based leader Vanessa Liu as an independent director of Goodman, starting June 1.Vanessa is currently co-founder and chief executive officer of SaaS technology company Sugarwork, and an independent director of Appen (ASX:APX). Shares in Goodman Group (ASX:GMG) are trading 2.3 per cent higher at $19.34.
Electro Optic Systems (ASX:EOS) was selected as the Commonwealth government furnished equipment provider for marine weapon stations. The government has indicated it may order 36 units of EOS’ remote weapon stations. Shares are trading 0.8 per cent higher at $1.90.
What else is on watch?
Several broker moves, APA Group (ASX:APA) rated as new Underweight at Barrenjoey with a price target of $10.91, while shares are trading 0.3 per cent higher at $11.14.
Liontown Resources (ASX:LTR) rated new Neutral at JPMorgan with a price target of $1.30, with shares up 3.5 per cent to $1.20, Monash IVF (ASX:MVF) cut to hold at Jefferies with a price target of $1.25, while shares are down 3.5 per cent to $1.06, and Tabcorp (ASX:TAH) raised to hold from sell at Morningstar, with shares up 2.5 per cent to $5.12.
Westpac (ASX:WBC) is trading 1.1 per cent higher at $24.06 amid takeover talks in progress on its flagship platform BT Panorama, according to the Australian.
Macquarie Group (ASX:MQG) is trading 3.8 per cent higher at $181.90.amid Canadian pension fund Ontario Teachers’ Pension Plan, inking a US$1 billion in a new offshore wind business launched by MacBank to develop global projects, according to Reuters.
Best and worst performers
The best-performing sector is information technology, up 5.2 per cent. The sector with the fewest gains is utilities, up 0.1 per cent.
The best-performing stock in the S&P/ASX 200 is Block (ASX:SQ2), trading 12.3 per cent higher at $112.14. It is followed by shares in Tyro Payments (ASX:TYR) and Link Administration Holdings (ASX:LNK).
The worst-performing stock in the S&P/ASX 200 is Gold Road Resources (ASX:GOR), trading 1.9 per cent lower at $1.26. It is followed by shares in IGO (ASX:IGO) and Reece (ASX:REH).
Commodities and the dollar
Gold is trading at US$1824.39 an ounce.
Iron ore is 4.5 per cent lower at US$127.55 a ton.
Iron ore futures are pointing to a fall of 0.3 per cent.
One Australian dollar is buying 68.70 US cents.
Source: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics