ASX Hits Record High as Miners Rally on Strait of Hormuz Optimism
Key Takeaways
- •The S&P/ASX 200 climbed 0.4 percent to a new all-time intraday high, supported by optimism surrounding the Strait of Hormuz and an upcoming earnings season.
- •Materials stocks led the market as copper prices reached record highs and gold posted its strongest rally in six months, with BHP rising 0.7 percent and Fortescue gaining 1.6 percent.
- •Glencore confirmed it will pursue a secondary listing on the ASX following unsuccessful merger discussions earlier this year.
- •AMP shares surged after the company reported a 57 percent increase in half-year profit and announced a $150 million share buyback program.
- •Energy stocks remained under pressure despite Brent crude recovering toward US$77 per barrel, as investors continued monitoring shipping activity through the Strait of Hormuz.
The Australian share market climbed to another record high on Thursday, buoyed by growing optimism surrounding the potential reopening of the Strait of Hormuz, through which roughly a fifth of global oil consumption typically passes. The positive sentiment comes ahead of a packed earnings season scheduled for next week, when many of Australia's largest listed companies will report results.
The S&P/ASX 200 rose 0.4 per cent by midday after earlier reaching a new all-time intraday high.
Australian investors largely looked past a mixed session on Wall Street overnight. The Dow Jones Industrial Average closed higher, while the S&P 500 and Nasdaq declined as shares in Alphabet and SpaceX came under pressure. Market participants also digested hawkish remarks from US Federal Reserve Governor Lisa Cook, who indicated she would back another interest rate increase should inflation persist at elevated levels.
Materials led the local market after copper prices reached fresh record highs and gold extended its strongest rally in six months. The sector is a major component of the ASX, given Australia's position as one of the world's largest exporters of iron ore, coal, and other commodities. BHP added 0.7 per cent and Fortescue gained 1.6 per cent, while Rio Tinto edged lower after Glencore confirmed it will pursue a secondary listing on the ASX following unsuccessful merger discussions earlier this year.
Energy stocks remained under pressure even as Brent crude recovered toward US$77 per barrel. Woodside and Santos both traded lower as investors continued monitoring developments related to shipping activity through the Strait of Hormuz.
Technology shares also weakened, with the overnight sell-off in US growth stocks spilling into the Australian market. WiseTech Global and Life360 both traded lower.
In corporate news, REA Group advanced after reporting an 11 per cent increase in full-year revenue. AMP surged after posting a 57 per cent rise in half-year profit and announcing a $150 million share buyback program.
Beach Energy declined after reporting a 21 per cent drop in full-year underlying profit. Block also traded lower despite surpassing market expectations with its latest US earnings results.
