ASX surges to record close; Mesoblast rips on flagship sales performance
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The news: The Australian sharemarket ripped to a record for the second day in a row, again driven by gains across all industry sectors.
The benchmark ASX 200 rose 1.37% to end at 8757.2 with all of the 11 sectors finishing in the green.
The health care sector (+2.5%) was the best performing as biotech company Mesoblast (34.6%) led ASX 200 gains after reporting $20 million in sales of its flagship stem cell therapy Ryoncil, which was launched in late March.
CSL (+3.6%) and Sigma Healthcare (+1.1%) also gained while Pro Medicus (-0.8%) finished lower.
BHP (+3%) helped drive gains in the materials sector (+2.1%) after it reported record iron ore and copper production for FY25. Fortescue (+0.5%) and Rio Tinto (+1.8%) also finished higher.
The finance sector (+1.2%) benefitted from gains across Australia’s four biggest banks: Commonwealth Bank (+0.9%), NAB (+1.3%), Westpac (+1.8%) and ANZ (+1.2%).
Biggest movers:
- Lithium miners – Tracked an overnight boost to spodumene prices after China’s Zangge Mining said that one of its units was ordered to halt non-compliant mining activity by Haixi prefecture authorities in the western province of Qinghai. Liontown Resources (+10.1%), Pilbara Minerals (+8.6%), Mineral Resources (+4.8%) and IGO (+2.3%) finished higher.
- Yancoal Australia (-5.8%) – Led losses on the ASX 200 after the coal miner reported a decline in sales volume in the June quarter on Thursday evening.
- Endeavour Group (-2.4%) – Morgan Stanley analysts downgraded their position on the Dan Murphy’s and BWS operator from ‘overweight’ to ‘equal-weight’ due to continued softness in the Australian retail market. They also cut their target price from $5.10 to $4.60.
Other news:
- CAR Group (+3.8%) – More than recuperated losses taken on Thursday, after the online car marketplace company announced that chief executive Cameron McIntyre is stepping down. UBS analysts lifted their target price on the stock from $45 to $46 on slightly better guidance.
- Fletcher Building (+3%) – Reported a steady decline in product sales volume across most categories in the New Zealand and Australian markets since its FY22 peak and does not expect "meaningful recovery before FY27".
- Virgin Australia Holdings (+1.9%) – UBS initiated coverage of the newly listed airline with a 'buy' rating and 12-month target price of $3.90 per share.
- Challenger (+1.7%) – Japanese life insurance giant TAL Dai-ichi Life will increase its equity stake in the investment manager from 15.1% to 19.9% after securing the required regulatory approvals.
- Infratil (+1.2%) – Macquarie analysts upgraded their position on New Zealand-based infrastructure company from ‘neutral’ to ‘outperform’ and lifted their target price by 18%, resuming coverage on the stock after a year.
- Atlas Arteria (-0.4%) – The toll road operator intends to submit a new rate application for its Dulles Greenway toll road in the US, after the Supreme Court of Virginia upheld the State Corporation Commission's decision to deny its latest rate increase.
- Droneshield (-2.3%) – Bell Potter analysts downgraded their position on the stock from ‘buy’ to ‘hold’ but raised its target price from $2.50 to $3.80 because the downside risk is “prevalent at current valuation”.
What’s ahead:
- Japan will hold elections for half of the 248 members of its House of Councillors, the upper house of its parliament, on Sunday.
- Statistics New Zealand will release consumer price index data for the June quarter on Monday at 8:45am.
