ASX rebounds as Middle East tensions ease
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The news: The Australian sharemarket rebounded on Monday after recording its worst day since mid-February on Friday, as Middle East tensions eased.
The numbers: The benchmark ASX 200 finished up 1.08% to 7,649.2, with 10 out of 11 sectors finishing in green.
The best-performing sector was healthcare, up 1.97%, followed by telecommunication services (1.73%) and IT (1.52%). The three largest healthcare companies CSL (2.08%), Cochlear (2.34%) and Resmed (0.72%) all enjoyed gains.
The top stock was miner South32, up 5.64% after it released its quarterly results that said the operations and exports of its manganese business would be halted until Q3 FY25, after it was hit by Tropical Cyclone Megan last month.
RBC Capital Markets analysts said that while its production result was “mixed” all FY24 guidance for production and costs was maintained, which would likely be seen as a positive.
Boss Energy also enjoyed gains of 3.27% after the company announced it had produced its first drum of uranium at its Honeymoon uranium project in South Australia.
Copper prices today reached a high of USD9,970 ($15,487) a tonne, driven by expectations that a recovering global economy would hike demand for industrial minerals. This led to a lift in copper-related stocks on the ASX including BHP (1.95%), Rio Tinto (0.29%), IGO (1.98%) and Sandfire Resources (0.33%).
The worst-performing and only sector to end in the red was energy, down 1.51%, followed by utilities (0.96%) and financials (0.97%). Oil and gas stocks slumped as crude prices tumbled due to easing tensions in the Middle East. Most of the large energy companies fell including Woodside (-2.79%), Santos (-1.66%), Yancoal (-1.72%) and Whitehaven Coal (-1.4%).
The worst performing stock across the wider ASX was DroneShield, down 16.52% after it expanded its initial share sale to $100 million following strong demand from investors.
Cettire also fell 6.15% after reports that one of its biggest investors had divested from the company.
Gold miners also fell due to the easing tensions in the Middle East, with declines from Northern Star (-1.9%), Gold Corporation (-1.43%), Newmont Corporation (0.57%), Bellevue Gold (-6.68%), Regis Resources (-3.73%) and Evolution Mining (-1.72%). Ramelius also fell, down 0.49%, despite upgrading its full-year production guidance after record quarterly gold production during the March quarter.
The Australian dollar is higher, buying US64.33 cents.
The context: All eyes will be on the Australian Bureau of Statistics' latest CPI figures on Wednesday as the Reserve Bank gears up for its next board meeting in two weeks.
Wednesday will also see Woodside’s annual general meeting take place at a time when the company has been under attack for its lack of climate ambition.
Offshore, the US figures for manufacturing purchasing managers index, quarterly GDP, unemployment claims, and core personal consumption expenditures index will be released, while the Bank of Japan makes its latest monetary policy decision.
Quarterly earnings for Tesla, Meta, Alphabet and Microsoft will also be released this week.
