Source : THE AGE NEWS
The Australian sharemarket has maintained its momentum after a positive start on Monday, paring back some of the losses it incurred in the previous trading week.
The ASX/S&P 200 index gained 88.2 points, or 1.1 per cent, to 8155.2 points as at 12.41pm AEDT, after losing 2.8 per cent over the past week. All 11 industry sectors were in the green, with financial, real estate and consumer stocks among the biggest winners.
The Australian dollar traded flat, and was valued at 62.54 US cents as at 12.39pm.
The ASX narrowly avoided a festive fumble on Monday morning after a key system for processing trades was hampered by a glitch on Friday.Credit: Dominic Lorrimer
Commonwealth Bank – the largest stock on the ASX – rose 1.9 per cent, and was followed into the green by ANZ (up 1.8 per cent), Westpac (up 1.5 per cent) and NAB (up 1.5 per cent). Macquarie gained 1.7 per cent, while Suncorp (up 1.9 per cent) and QBE (up 0.5 per cent) also moved up. Digital financial services firm Zip Co. was one of the biggest winners on Monday, adding 7.1 per cent.
Kmart and Bunnings owner Wesfarmers (up 2 per cent) rose, while JB Hi-Fi (up 2.7 per cent) and Aristocrat Leisure (up 1.1 per cent) also advanced. The real estate sector (up 1.7 per cent) enjoyed a solid start, with Goodman Group (up 1.7 per cent), Scentre Group (up 1.6 per cent) and Mirvac Group (up 2.7 per cent).
Woodside Energy (up 1.2 per cent) and Santos (up 0.9 per cent) propped up the energy sector, as Ampol (down 0.8 per cent) retreated. Mining giants BHP (down 0.2 per cent) and Rio Tinto (down 0.8 per cent) fell, while Fortescue (up 0.1 per cent) observed a modest rise.
Gold miners Newmont (up 3.2 per cent) and Northern Star Resources (up 1.1 per cent) traded positively, after facing significant losses last week as the gold price tumbled to its lowest price in a month.
Mineral explorer Deep Yellow (up 6.1 per cent) recouped some of the losses it faced last week, after telling shareholders it wouldn’t make a final investment decision on its Tumas uranium mine in Namibia until early March amid delayed costings and quotes for equipment and construction.
Origin Energy (up 1.4 per cent) and APA (up 1 per cent) posted gains, while Mercury New Zealand (down 3 per cent) fell. Meridian Energy traded flat, while AGL grew 0.2 per cent.
Trading on the ASX was at risk ahead of the Christmas trading week, with the market operator unable to resolve a technical issue with its system for processing investor trades until Sunday.
On Friday, trading on the ASX was hampered by a technical issue delaying the settlement of trades on its Clearing House Electronic Subregister System, known as CHESS. The glitch forced the market operator to defer settlements scheduled for Friday to Monday, December 23, leaving brokers in a jam as billions of dollars worth of transactions couldn’t be finalised.
The CHESS system manages the transaction of shares between a buyer and a seller. Had the issue not been resolved, the ASX could have been forced to delay the time of market opening on Monday, or at worst cancel trading altogether.
The ASX suffered a full-day trading outage in November 2020, and the market operator’s effort to upgrade the ageing CHESS system, which is 30 years old, has suffered significant delays.
Meanwhile in the US, the S&P500 rose 1.1 per cent on Friday to post its best day in six weeks and shave its loss for the week down to 2 per cent. The Dow Jones Industrial Average jumped 498 points, or 1.2 per cent, and the Nasdaq composite gained 1 per cent.
Superstar stock Nvidia and other big tech companies led the market, which got a lift after a report said a measure of inflation the Federal Reserve likes to use, was slightly lower last month than economists expected. It’s an encouraging signal following recent reports suggesting inflation may be tough to get all the way down to the Fed’s 2 per cent goal from its peak above 9 per cent.
The threat of higher inflation was one of the reasons Fed Chair Jerome Powell gave this week when the central bank hinted it may deliver fewer cuts to interest rates next year than it earlier expected.
Friday’s better-than-expected inflation data pushed traders to trim their bets for zero cuts in 2025, which they now collectively see a 16 per cent chance of.
