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ASX closes 0.59pc up, rises above barrier

Steven Deare
·4-min read

Australia's share market has closed higher and investors have overcome a barrier in their efforts to push the indices above the record highs set in February last year.

The S&P/ASX200 benchmark index closed higher by 40.2 points, or 0.59 per cent, to 6880.7 on Monday.

The All Ordinaries closed higher by 47.9 points, or 0.67 per cent, at 7160.8.

The ASX200 has since Friday continued to rise above 6800 points, which it struggled to top since November.

On Monday, the materials sector was the biggest contributor, rising 1.98 per cent.

ThinkMarkets analyst Carl Capolingua said this was due to iron ore prices increasing in Chinese futures markets.

The consumer discretionaries sector also played a handy role, climbing 1.45 per cent.

Yet the sector most important to the ASX200 topping the 6800 level has been financials, according to Mr Capolingua.

Last week the sector gained 5.65 per cent after the Reserve Bank said it would extend its bond-buying program, and reiterated rates would remain low for several years.

Mr Capolingua said signs pointed to a better long-term economic outlook, and banks would benefit.

"The banks' bread and butter is to lend long term, and borrow short term," he said.

"We're expecting better economic growth from government stimulus, and that's pushing up bond yields and banks' profit expectations."

The ASX200 is gaining on its record high of 7197.2 in February last year, before much of the world realised the effects of the pandemic.

The ASX rise follows US markets closing higher on Friday.

Investors on Wall Street were confident following good company earnings, the distribution of vaccines and government talks to provide $US1.9 trillion in stimulus.

Among notable ASX moves, Afterpay set a record price for a second consecutive session.

Shares reached a record $156.50 early, then closed higher by 1.43 per cent to $153.46.

Telecommunications provider Vocus Group surged by 12.79 per cent to $54.94 after Macquarie Infrastructure and Real Assets Holdings made a purchase offer.

The two companies offered to buy all shares for $5.50 each. Vocus will provide detailed financial reports to help evaluate a sale.

Vocus provides internet, mobile and energy services, and operates the Dodo and iPrimus brands among others.

Another big improver was Sigma Healthcare, which jumped 7.35 per cent to 73 cents after it said full-year earnings were expected to climb 35 per cent on the previous financial year.

Sigma, which owns pharmacy chains Amcal and Guardian, gave earnings guidance of about $80 million.

The company also extended a $250 million receivables purchase agreement with Westpac for three years.

Mining technology provider Imdex rose 7.25 per cent to $1.85 after it claimed first-half earnings were up six per cent on the same time last year.

Net profit after tax was down 26 per cent to $13.5 million, compared to first-half 2020.

Shareholders will receive an interim dividend of one cent per share, the same amount as the previous interim payout.

In mining, BHP rose 2.37 per cent to $44.84, Fortescue was up 2.11 per cent to $23.72 and Rio Tinto climbed 3.41 per cent to $117.20.

In banking, ANZ was higher by 0.43 per cent to $25.40, the Commonwealth lost 0.02 per cent to $88.62, NAB was better by 0.91 per cent to $25.46 and Westpac climbed 1.35 per cent to $22.45.

On Tuesday, financial services provider Suncorp and building materials supplier Boral give first-half earnings.

Another building materials supplier, James Hardie, will give third quarter figures.

The Aussie dollar was buying 76.74 US cents at 1702 AEDT, higher from 75.95 US cents at Friday's close.


* The S&P/ASX200 benchmark index closed higher by 40.2 points, or 0.59 per cent, to 6880.7 on Monday.

* The All Ordinaries closed higher by 47.9 points, or 0.67 per cent, at 7160.8.

* At 1702 AEDT, the SPI200 futures index was steady at 6810 points.


One Australian dollar buys:

* 76.74 US cents, from 75.95 cents on Friday

* 80.96 Japanese yen, from 80.23 yen

* 63.76 Euro cents, from 63.55 cents

* 55.90 British pence, from 55.57 pence

* 106.60 NZ cents, from 106.24 cents.