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ASX snaps losing streak in broad rebound

AUSTRALIAN STOCK EXCHANGE
The Australian sharemarket lifted on May 31 to end a three-day losing streak. Picture: NCA NewsWire / Jeremy Piper

The Australian sharemarket shrugged off a grim night on Wall St to snap a three-day losing streak and finish the week on a rebound.

The benchmark ASX 200 lifted 73.5 points, or nearly 1 per cent, to close at 7,701.7, while the broader All Ordinaries index rose 74.9 points, or 0.95 per cent, to finish at 7,970.8.

Tech stocks also lifted 25.6 points, or 0.84 per cent, to 3,075.

The lift was broadbased, with 10 of 11 industry sectors ending in the green, led by staples with a hefty 1.91 per cent rise and energy with a 1.77 per cent jump.

Retail behemoths Woolworths and Coles lifted 2 per cent to $31.60 a share and 1.73 per cent to $16.42 a share, respectively, while poultry producer Inghams jumped 2 per cent to $3.54.

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Oil and gas giant Woodside Energy rebounded 2 per cent from Thursday’s sell-off to close at $27.70 a share while Santos climbed 1.87 per cent to $7.63.

The positive trading day snapped a three-day losing streak and bucked a grim session on Wall St overnight, which saw the Dow Jones tumble 330 points, or 0.86 per cent, to 38,111.

The S&P 500 slipped 0.6 per cent to 5235 while the tech-heavy Nasdaq slumped 1.08 per cent to 16,737.

Wall Street’s woes came despite a downward revision to US GDP figures, which IG markets analyst Tony Sycamore said would usually trigger a “thumping rally” in equity markets on Federal Reserve rate cut hopes.

The ASX200 rebounded on Friday to end a three-day losing streak. Picture: NCA NewsWire / Christian Gilles
The ASX200 rebounded on Friday to end a three-day losing streak. Picture: NCA NewsWire / Christian Gilles

“I think the ‘bad news is good news’ playbook failed to play out last night for two reasons,” he said.

“Firstly, after upside surprises in Australian and German inflation reports earlier this week, the market is taking a more cautious approach to tonight’s European Area and US consumption expenditure inflation data.

“The second is due to month-end rebalancing flows.

“When markets have outperformed as the Nasdaq has done, fund managers are forced to sell the outperformers to return to benchmark portfolio weightings.”

Mr Sycamore suggested the resilience in Australian equity markets on Friday may have been propelled by a ‘buy the loser’ strategy given the relative poor performance of the ASX200 across May compared to Wall St.

Month-to-date, the Nasdaq is up about 6.3 per cent and the S and P 500 is up about 4 per cent.

The ASX200, by contrast, is flat.

GUZMAN Y GOMEZ
Guzman y Gomez announced on Friday it would list on the ASX in June. Picture: NCA Newswire /Gaye Gerard

Mining giants BHP and Rio Tinto booked gains, rising 0.47 per cent to $44.51, and 1.02 per cent to $128.96, respectively.

But Fortescue continued its down week, slipping 0.16 per cent to close at $24.74 despite a run up in late afternoon trading.

The big banks booked gains, led by Commonwealth Bank with a 1.31 per cent rise to $119.54.

NAB rose 0.89 per cent to $33.91, ANZ lifted 1.15 per cent to $28.25 and Westpac eked out a 0.19 per cent rise $25.98.

In corporate news, Australian fast food chain Guzman y Gomez has announced it will list on the ASX in June.

The Mexican restaurant and takeaway business will sell 11.1 million shares at $22 a piece for a $2.2bn valuation.

Qantas inked a deal with Perth Airport to relocate the airline’s operations to a new $3bn terminal by 2031.

The company jumped 1.32 per cent in late trading to close at $6.15.

The top gainer on the ASX200 was Telix Pharmaceuticals, which soared 15.3 per cent to $18.15 on positive data from a cancer drug study.

The largest laggard was Megaport Limited, which fell 3.41 per cent per cent to $13.56.

The dollar gained 0.08 per cent against the Greenback to buy US66.3c at the closing bell.