The Australian sharemarket rebounded from a $63 billion wipeout as bargain hunters piled back into equities after strong US economic data kept the possibility of rate cuts on the cards.
The S&P/ASX 200 Index was up 39.10 points, or by 0.4%, at 8940.50, having traded as high as 8964.10 points in the morning session, buoyed by a strong rally on Wall Street overnight.
Stocks were sold off around the world on Wednesday, sending the ASX 200 diving 1.9%, amid fears of a protracted war in Iran that will keep oil prices elevated and reignite inflation. Brent rose a further 3.1% to $US83.90 per barrel as the ASX shut.
But strong US economic data – including private payrolls and the ISM Services Index – eased some of those fears and kept hopes of rate cuts from the Federal Reserve alive.
On the ASX, investors rotated into rate-sensitive, growth-centric technology stocks. WiseTech Global rose 7.1% to $47.53, Xero 3.4% and NextDC 5.3%.
Defensive health stocks also rose. CSL rose 2.5% to $146.49 after CSL Seqirus secured a contract to support to supply 15 million flu vaccines to Canada in the event of a pandemic. Pro Medicus rallied 4.6% to $121.49.
Energy was now up more than 8% for the week despite Woodside falling 1% to $30.45 as it traded ex-dividend. Refiners saw the strongest gains with Viva Energy up 11.9% to $2.07, and Ampol by 8.5% to $32.06, on reports China has instructed its top oil refiners to suspend diesel and gasoline exports.
“This provides a direct boost to Australian fuel retailers and refiners, who stand to benefit from higher margins and stronger pricing,” Jocum said.
Miners were the weakest as BHP retreated 1% to $55.15 after it traded ex-dividend. Fortescue climbed 2.1% to $19.39 and Rio Tinto 1.2% to $164.58 as iron ore briefly cracked $US100 per tonne. Gold miners saw heavy selling again. Genesis Minerals lost 4.2% to $7.25 and Northern Star 1.9% to $29.36.
And DroneShield jumped 10.1% to $3.70 following heavy selling this week despite the heightened drone activity in the Middle East.
In corporate news, Pengana Capital added 3.5% to 74.5¢ as it appointed Antipodes to assist with the management of its international equities listed investment company.
The Lottery Corporation fell 0.7% to $5.36 amid plans to implement a new operating model in July that will create three customer-facing business units. It’s also reshaping its executive team.
Deep Yellow fell 2.4% to $2.46 as its shares resumed trading after it quashed a media report that it was planning a capital raising.
And Star Entertainment was flat at 12¢. The Federal Court’s Justice Michael Lee has ruled that the Australian Securities and Investments Commission failed to prove its case against the majority of Star Entertainment’s directors. It, however, made an adverse finding against former CEO Matt Bekier.