The Australian sharemarket rose on Thursday as gains among the interest rate-sensitive sectors including property, banking and tech halted a two-day losing streak driven by softer commodity prices.
On the day, the S&P/ASX 200 rose 0.4 per cent, or 34.2 points, to 7749.7 points after falling more than 1 per cent the previous two sessions.
The advance followed Wall Street’s ballooning bull run as the S&P 500 reset a record high at 5421.03 points overnight and the tech-heavy Nasdaq jumped to a fresh peak of 17,610. The current bull market has reached 20 months.
Rate cut hopes
Overnight, traders ramped up expectations the US Federal Reserve will pivot to rate cuts as early as September after US CPI data for May showed inflation cooling.
The best-performing sector on the ASX was technology, jumping 2.1 per cent amid a broad mania for businesses considered beneficiaries of technologies linked to artificial intelligence.
Data centre business NextDC jumped 3.6 per cent to a record close of $18.03, with both enterprise software groups Xero and WiseTech up around 2 per cent to $131.75 and $98.91 respectively.
The big four banks also edged higher, with Commonwealth Bank up 1.1 per cent to $125.48 and National Australia Bank adding 0.8 per cent to $35.01 after earlier reaching its highest level since 2015 at $35.23. While Goodman Group led property stocks higher, climbing 2.3 per cent to $35.53.
The materials sector, meanwhile, extended a poor week to lose 0.5 per cent on Thursday and has now tumbled 4.5 per cent over the past month. Lithium and iron ore giant Mineral Resources fell 1.6 per cent to $63.11 to mark seven straight sessions of falls. BHP Group lost 0.7 per cent to $43.20, falling for a third day.
Stocks in focus
In corporate news, Pharmacy group Sigma dropped 3.7 per cent to $1.16 after the competition regulator flagged concerns around its proposed $8.8 billion merger with Chemist Warehouse.
“It’s not a surprise to us the ACCC released the statement of issues given the size of the transaction and the market grip they have,” said Martin Hickson, a portfolio manager at 1851 Capital.
“In terms of the overlap, I think there are 10 postcodes and around 13 stores where they would exceed 50 per cent market share in those postcodes.
“If that’s the issue, I think targeted divestments of those stores could potentially appease the ACCC. So I still think there’s a reasonable probability the transaction does proceed, but it may be forced to divest select stores where there’s significant market share within a region.”
In other news, ASX Ltd lost 8 per cent to $58.14 after the stock exchange operator warned of rising costs related to technology. It forecast a total expense growth rate for fiscal 2024 of about 15 per cent, which is at the top end of guidance, while the FY25 growth rate is tipped to be between 6 per cent and 9 per cent.