Markets wrap: Mining titans on fire, but late energy sector fade halts ASX winning streak

The mining titans were strong on Thursday, but not strong enough to drag the Australian sharemarket to an eighth straight session of gains.

The ASX 200 gained ground in 11 of the final 14 sessions of March. Picture: NCA NewsWire / Jeremy Piper

A late fade killed the prospect of an eighth straight win for the Australian sharemarket, but investors can still look back on March as a period rich in gains – and drama.

The local bourse jumped to a new three-month high at Thursday’s open as BHP, Rio Tinto and Fortescue Metals rode an iron ore rally to near $US160 a tonne, before news of an impending US oil reserve release sapped energy stocks and weighed the market down.

Word that Australia would be imposing a 35 per cent tariff on Russian imports also seemed to spook investors, while strong building approvals data did little to excite the major banks.

Having spent most of the day ahead, the ASX 200 faded late to end the final session of the month and quarter 14.9 points, or 0.2 per cent, lower at 7499.6.

All major banks fell, including a 1.2 per cent drop for Commonwealth Bank to $105.77, a 1.1 per cent slide for Westpac to $24.24, a 1 per cent fall for ANZ to $27.60 and a 1.9 per cent drop for Macquarie Group to $203.27. Picture: NCA NewsWire / Jeremy Piper

The broader All Ordinaries fell 10.3 points, or 0.1 per cent, to close at 7789.6, while the Aussie dollar eased to 74.85 US cents at the local close.

Stocks initially rose by as much as 0.6 per cent on Thursday as the ASX 200 looked destined to match its best winning streak since 2017 thanks to another strong session for the materials sector.

Despite the slide, the local benchmark managed to add 6.4 per cent for the month and continue to defy the chaos in Eastern Europe.

City Index analyst Tony Sycamore said March would certainly go down as a memorable one for ASX traders, proclaiming “beware the ides of March”.

“Whether you believe in superstitions or not, March 2022 will go down as a memorable one for the local bourse,” he said,

“After its rally this month, the ASX200 will be one of the few stock markets to end the first quarter of 2022 in positive territory.”

The overnight lead from Europe and the US was weak after Russia sunk hopes of a peaceful resolution with Ukraine.

The local bourse jumped to a new three-month high at Thursday’s open as BHP, Rio Tinto and Fortescue Metals rode an iron ore rally to near $US160 a tonne, before news of an impending US oil reserve release sapped energy stocks and weighed the market down. Picture: Evan Collis

Local traders were nonetheless enthusiastic for mining stocks early on with BHP adding 2.3 per cent to $51.75, Rio Tinto gaining 1.9 per cent to $119.11, Fortescue Metals up 4.3 per cent to $20.66 and Champion Iron 6 per cent higher at $7.81.

Lithium players also got a boost after US President Joe Biden flagged a production boost for critical minerals, with Vulcan Energy 4.1 per cent higher at $10.15, Mineral Resources up 4.4 per cent to $52.71 and Novonix gaining 9.7 per cent to $6.20.

Coal miners Whitehaven, New Hope, Carnarvon and Yancoal all gained ground, but gold stocks such as Newcrest Mining and Northern Star handed back early gains.

All major banks fell, including a 1.2 per cent drop for Commonwealth Bank to $105.77, a 1.1 per cent slide for Westpac to $24.24, a 1 per cent fall for ANZ to $27.60 and a 1.9 per cent drop for Macquarie Group to $203.27.

NAB was flat at $32.35.

Word that Australia would be imposing a 35 per cent tariff on Russian imports also seemed to spook investors, while strong building approvals data did little to excite the major banks. Picture: Vincent Mundy/Bloomberg

Growth sectors were deep in the red, with a 4.7 per cent drop for Afterpay owner Block Inc weighing on tech stocks and health giant CSL down 0.7 per cent to $268.15.

Woolworths managed to gain 0.5 per cent to $37.26, Telstra bounced 1.5 per cent to $3.96, and Transurban was 1.8 per cent higher at $13.55, but there was little else to cheer about at the top end of the market.

News that the Biden Administration was preparing to release a million barrels of oil a day from US reserves for several months helped ease oil prices, with Woodside Petroleum subsequently down 1.4 per cent to $32.10 and Santos falling 1.7 per cent to $7.74.

“Given that the Biden administration is taking a very muscular stance toward Moscow, promising further sanctions if Russia continues to wage war in Ukraine, we believe that the SPR (strategic petroleum reserve) release is being used as a tool to blunt the impact of these foreign policy decisions for US consumers,” said RBC Capital Markets’ head of global commodity strategy, Helima Croft.

“It will be important to see whether this release announcement will be an effective shock and awe tactic, given that Russian energy losses are likely to climb as the military campaign intensifies and the humanitarian crisis in Europe grows more dire.”

Originally published as Markets wrap: Mining titans on fire, but late energy sector fade halts ASX winning streak