The Australian sharemarket snapped its three-day losing streak and rebounded to positive territory thanks to a boost in tech and resource stocks. The clarity from the Federal Reserve’s reassurance around a soft landing and the Reserve Bank unveiling a 25 basis point hike was enough for investors to put risk on the table and buy into stocks amid the dip in the 10-year treasury yield, providing support for long-duration stocks to advance.
The information tech sector led the pack, up 2.5 per cent, followed by energy, up 2 per cent, then utilities and real estate, both up 1.7 per cent. Financials were the only sector to close lower, down 0.1 per cent.
Novonix (ASX:NVX) led the tech space, up 6.4 per cent to $4.97, followed by Megaport (ASX:MP1), up 4.8 per cent to $8.49.
Energy stocks rallied, led by Beach Energy (ASX:BPT), up 3.9 per cent to $1.72, while Woodside Petroleum (ASX:WPL) rose 2.2 per cent to $31.82 and Santos (ASX:STO) closed 1.4 per cent higher at $8.18.
Gold miners charged ahead, led by Newcrest Mining (ASX:NCM), up 2.7 per cent to $26.89, while Northern Star (ASX:NST) added 2.2 per cent to $9.66 and Evolution Mining (ASX:EVN) closed 2.1 per cent higher at $3.94.
Fortescue Metals (ASX:FMG) led iron ore players, up 3.5 per cent to $20.83, while Rio Tinto (ASX:RIO) lifted 0.4 per cent to $111.58 and BHP Group (ASX:BHP) closed 0.1 per cent higher at $47.45.
Meanwhile, Commonwealth (ASX:CBA) was the only major bank to close higher, up 0.7 per cent to $103.71, while ANZ Banking (ASX:ANZ) weighed the most, down 1.7 per cent to $26.91.
At the closing bell, the S&P/ASX 200 was 0.8 per cent or 60 points higher at 7,365.
Local economic news
The nation’s trade surplus increased to $9.3 billion in March from a marginally revised $7.4 billion in the previous month, beating market forecasts of a surplus of $8.5 billion as the nation saw a decline in imports.
Meanwhile, the total number of dwellings approved fell 18.5 per cent in seasonally adjusted terms in March, following a 42.0 per cent rise in February, according to data released today by the Australian Bureau of Statistics.
What else was on watch?
Several broker moves, starting with the companies that have been downgraded. Goldman Sachs cut ANZ Bank (ASX:ANZ) neutral from buy, with shares down 0.6 per cent to $32.25, Jefferies reduced Harvey Norman (ASX:HVN) hold from buy, with shares down 1.4 per cent to $4.84, and Liberum cut BHP Group (ASX:BHP) to sell from hold, with shares up 0.1 per cent to $47.45.
To the upgrades, JPMorgan raised ARB Corp (ASX:ARB) to neutral from underweight, with shares down 1.2 per cent to $33.22, Credit Suisse raised Fortescue (ASX:FMG) to neutral from underperform, with shares up 3.5 per cent to $20.83, and Morgan Financial hiked PTB Group (ASX:PTB) to add with a price target of $1.51, with shares up 0.4 per cent to $1.22.
Metcash (ASX:MTS), according to The Australian, the grocery wholesaler hired Goldman Sachs to consider buying Superior Food Services from Quadrant Private Equity. Shares closed 0.7 per cent lower at $4.70.
Wheat futures have jumped sharply higher as there remains some political uncertainty in the news as to the Indian wheat export ban or restriction. Shares in Graincorp (ASX:GNC) closed flat at $10.73.
Clients have withdrawn cash for 18 straight quarters from the fund manager Janus Henderson (ASX:JHG). The company missed earnings estimates and saw a decline in assets under management from US$432 billion in the fourth quarter of 2021 to roughly US$361 billion in the first quarter of 2022 attributed to market conditions, net outflows, and the sale of one of its subsidiaries in the period. Shares closed 13 per cent lower at $37.76 and were the worst-performing stock.
Ramsay Healthcare (ASX:RHC) posted after market close yesterday stating that they’ve provided a notice to private health insurance provider Bupa to terminate the hospital purchaser provider agreement. This is set to affect Bupa customers wanting access to Ramsay hospitals. Shares closed 0.7 per cent lower at $78.49.
It was another big day for company news
National Australia Bank’s (ASX:NAB) expenses rose 2.6 per cent “reflecting additional bankers and resources to support growth.” However, the bank raised cash earnings by 4.1 per cent in the half year ending March 31 to $3.48 billion, and hiked its interim dividend to 73 cents, compared to 67 cents in the prior year period. Shares closed 0.6 per cent lower at $32.25.
Qantas (ASX:QAN) is set buy the remaining 80 per cent stake in Alliance with the aim to raise $614 million in a share placement to pay for the deal. The transaction will not impact its long-term partnership with Alliance, where Alliance operates jets for QantasLink. Shares closed 0.9 per cent lower at $5.62.
QBE Insurance (ASX:QBE) said that the year has started strongly with premium growth with a combined operating ratio of 94 per cent. A ratio above 100 per cent means that they are running at a loss. The insurer also said that new growth came from crop insurance, with premiums in the year likely to be US$3.3 billion, up from US$2.7 billion a year earlier. Shares closed 5.7 per cent higher at $12.70.
Vicinity Centres (ASX:VCX) reaffirmed its 2022 financial year guidance following its March quarter update which was described as strong, despite effects of the Omicron strain and floods in NSW and Queensland. The real estate investment trust expects funds from operations (FFO) per security to be in the range of 11.8 to 12.6 cents. Shares closed 4.1 per cent higher at $1.91.
Flight Centre (ASX:FLT), Goldman Travel and the Spencer Group of Companies have launched a joint venture focused on premium and business travel called Link Travel Group. Flight Centre will initially hold a 60 per cent interest in the joint venture. Shares closed 1.3 per cent higher at $21.47.
Construction company Cimic (ASX:CIM) announced that its subsidiary CPB Contractors was selected as part of a joint venture by the NSW government to deliver the western section of the M12 Motorway. The contract is expected to generate revenue of around $245 million for CPB Contractors. Shares closed flat at $22.01.
Perenti (ASX:PRN) sold off a number of units and property assets since the financial year began that delivered cash of $134.7 million, excluding transaction costs. The sales included the initial public offering of Chrysos Corporation for $46.3 million, and its onshore oil and gas equipment supplier Well Control Solutions, for $2.6 million. Shares closed 2.5 per cent higher at $0.71.
AMP (ASX:AMP) reported $1.3 billion in net cash outflows from its Australian Wealth Management (AWM) during the March quarter, an improvement from $2 billion in the prior year period. AMP Bank’s total loan book grew by.5 billion to $22.6 billion. Shares closed 1.9 per cent higher at $1.21.
Netwealth (ASX:NWL) reported lower than expected net inflows of around $790 million in April, impacted by Covid-related absenteeism, volatile market conditions, and investor sentiment relating to geopolitical events and interest rate speculations. Shares closed 0.8 per cent higher at $12.67.
The Dow Jones futures are pointing to a rise of 15 points.
The S&P 500 futures are pointing to a rise of 1 point.
The Nasdaq futures are pointing to a rise of 3 points.
The SPI futures are pointing to a rise of 60 points when the market next opens.
Best and worst performers
The best-performing sector was Information Technology, up 2.5 per cent. The worst-performing sector was Financials, down 0.01 per cent.
The best-performing stock in the S&P/ASX 200 was Liontown Resources (ASX:LTR), closing 7.7 per cent higher at $1.47. It was followed by shares in Pilbara Minerals (ASX:PLS) and Adbri (ASX:ABC).
The worst-performing stock in the S&P/ASX 200 was Janus Henderson Group (ASX:JHG), closing 13 per cent lower at $37.76. It was followed by shares in Life360 (ASX:360) and Nanosonics (ASX:NAN).
Japan’s Nikkei is closed due to Children’s Day.
Hong Kong’s Hang Seng has gained 0.5 per cent.
China’s Shanghai Composite has gained 0.8 per cent.
Commodities and the dollar
Gold is trading at US$1899.99 an ounce.
Iron ore is 0.4 per cent higher at US$142.90 a ton.
Iron ore futures are pointing to a rise of 2.8 per cent.
Light crude is trading $0.91 higher at US$108.72 a barrel.
One Australian dollar is buying 72.43 US cents.