A good start to financial year for ASX: Wednesday 1 July 2020

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Derek Rose
(Australian Associated Press)

 

Tech stocks and property have led the Australian share market higher as Australian manufacturing activity rebounded and lockdowns eased in NSW.

After starting Wednesday with a five-point dip, the benchmark S&P/ASX200 index rebounded by 60 points by noon and then faded in the afternoon to finish up 36.5 points, or 0.62 per cent, at 5,934.4 points

The broader All Ordinaries index finished up 39.7 points, or 0.66 per cent, at 6,041.

“Today we kicked off the financial year, first down she went, then up she goes,” Bell Direct market analyst Jessica Amir said.

Upbeat Performance of Manufacturing Index (PMI) data showed Australian manufacturing activity returned to growth in June, thanks to a strong performance by the food and beverage sector, helped lift sentiment.

Manufacturing activity had suffered two months of severe contraction in April and May and Ms Amir called the data a major milestone, even though manufacturing is not a major part of the Australian economy.

Overnight, US markets rallied as Federal Reserve chairman Jerome Powell backed a coronavirus economic rescue package, but the mood remained cautious as Mr Powell reiterated that the path of the US economy was “highly uncertain” due to the pandemic’s impact

Afterpay helped bolster the tech sector, continuing its phenomenal run by setting an all-time high of $63.90 before closing up 2.1 per cent at $62.24 – having begun the year under $30.

All the big banks were higher, with Westpac up 1.8 per cent to $18.28, Commonwealth Bank up 0.7 per cent to $69.88, NAB advancing 1.9 per cent to $18.56 and ANZ climbing 1.3 per cent to $18.88.

Hub24 rose 10.5 per cent to $10.28 after Morgans raised its price target on the wealth manager, while rival Challenger rose 6.4 per cent to $4.69 after its share purchase plan opened.

Suncorp dropped 4.1 per cent to $8.85 after the insurance and banking major made a raft of executive appointments and said it would overhaul its operating model in light of COVID-19.

CSL dropped 0.9 per cent to $284.40, its fourth day of losses, although Australia’s biggest company by ASX-listed shares is still ahead for the year.

Alterity Therapeutics closed up more than ninefold – going from three cents to 16.5 cents, and hitting an intraday high of 42 cents – after the small-cap Melbourne biotech company said it had guidance from the US Food and Drug Administration over its drug candidate to treat a neurological disorder known as Multiple System Atrophy.

In the heavyweight mining sector, gold miners shone as the price of the precious metal broke $US1,780 an ounce for the first time since 2012, and reached as high as $US1,786.

Evolution climbed 6.2 per cent to $6.02, Saracen Mineral Holdings rose 4.0 per cent to $5.64 and Northern Star was up 7.0 per cent to $14.30.

Among diversified miners, BHP was flat at $35.82 and Rio Tinto dipped 0.8 per cent to $97.15, while iron ore giant Fortescue Metals dropped 0.7 per cent to $13.76.

Data centre operator NextDC gained 8.1 per cent to $10.68 after winning more customer commitments at its NSW facilities.

Travel companies did well, with Webjet up 7.5 per cent, Flight Centre ahead by 3.2 per cent, Qantas gaining 2.4 per cent and Air New Zealand rising 4.1 per cent.

The Australian dollar was buying 69.07 US cents, up from 68.49 US cents at the close of trade on Tuesday.

ON THE ASX

* The benchmark S&P/ASX200 index on Wednesday closed up 36.5 points, or 0.62 per cent, at 5,934.4 points

* The All Ordinaries closed up 39.7 points, or 0.66 per cent, at 6,041 points

* At 1748 AEST, the SPI200 futures index was down one point, or 0.02 per cent, at 5,902 points

CURRENCY SNAPSHOT

One Australian dollar buys:

* 69.07 US cents, from 68.49 US cents on Tuesday

* 74.30 Japanese yen, from 73.77 yen

* 61.50 euro cents, from 61.10 cents

* 55.80 British pence, from 55.84 pence

* 106.98 NZ cents, from 106.94 cents.

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