Markets wrap: Tech shares rally hard to help ASX to three-week high

It was a strong session for rate-sensitive technology and payment firms as the local sharemarket started the week sharply higher.

ASX traders carried Friday’s form into a new week with rate-sensitive technology stocks helping to catapult the local sharemarket to three-week highs.

Block Inc and Zip Co led a sizzling buy now, pay later rally, while tech stocks such as Tyro, Novonix and Xero also rode a wave of inflation relief to take the benchmark ASX 200 103.9 points, or 1.5 per cent, higher to 7286.8.

The broader All Ordinaries gained 109.5 points, also 1.5 per cent, to end the day at 7522.6, while the Aussie dollar continued to rise against the Greenback.

It was buying just under 72 US cents at the local close.

BHP was the biggest lifter among the miners on Monday following news both Shanghai and Beijing had eased Covid-19 restrictions.

Lithium stocks and gold miners were also strong, although coal companies were a rare patch of red.

The benchmark ASX 200 finished Monday up 103.9 points, or 1.5 per cent, at a three-week high 7286.8. Picture: NCA NewsWire / Jeremy Piper

There were also gains for most of the banks, even if they were outdone by healthcare names and retail conglomerates.

Monday’s bounce was the best single session in two weeks and came after the major Wall Street indices closed out their best week of the year so far.

Encouraging data helped ease inflation fears – and therefore anxiety around future Fed tightening – while still managing to show strength among US consumers.

Tech shares were the main beneficiaries of Friday’s rise, with Telsa rising 7.3 per cent, Amazon up 3.7 per cent, Apple 4.1 per cent higher, and Alphabet gaining 4.2 per cent.

IG Markets analyst Hebe Chen said traders have clearly seen a silver lining in recent data that suggests the economy may be more resilient and self-adjustable than the market expected.

However, she said it was too early to say recession concern has dissipated.

“First, none of the data so far is strong enough to convince the Fed to back away from their planned 50 basis-point rate hikes for the next couple of meetings, and don’t forget that they will start culling assets from its $9 trillion balance sheet from June,” Ms Chen said.

Among health companies, blood giant CSL finished 1.9 per cent higher at $274 and respiratory device maker Resmed climbed 2.5 per cent to $29.22. Picture: NCA NewsWire / Gaye Gerard

“Second, based on the recent forward indicator like the PPI (Producer Price Index), the inflation pressure will continue to build up, suggesting that there’s still some time ahead before the central banks slow the pace of tightening.”

Monday was nonetheless a strong session for high-growth, interest rate-sensitive names across the tech, health and payments sectors.

Block Inc rose 10.9 per cent to $129.85, Zip Co rose 14 per cent to 97.5 cents, and Sezzle was 10.6 per cent higher at 57.5 cents in a stellar day for buy now, pay later firms.

Xero rose 5.2 per cent to $92.02, Megaport gained 8.6 per cent to $7.73, EML Payments was up 8.1 per cent to $1.595, Novonix rose 11 per cent to $4.14, and Tyro Payments gained 10.2 per cent to $1.135.

Among health companies, blood giant CSL finished 1.9 per cent higher at $274 and respiratory device maker Resmed climbed 2.5 per cent to $29.22.

Cochlear gained 2.9 per cent to $224.77, Fisher and Paykel added 2.8 per cent to $18.51 and Pro Medicus was 3.7 per cent ahead at $42.27.

BHP rose 2.8 per cent to $44.91 and Fortescue Metals added 1.3 per cent to $19.85 to lift the materials sector, while Rio Tinto climbed 0.4 per cent to $113.80.

It was an even more luminous day for lithium miners with Piedmont gaining 7.6 per cent, Core Lithium rising 5.4 per cent, Lake Resources up 4.6 per cent, Vulcan Energy adding 5.3 per cent, Mineral Resources 2.3 per cent higher and Pilbara Resources gaining 2.4 per cent.

Retail giant Woolworths finished 2.2 per cent up at $34.93 and Wesfarmers gained 2 per cent to $47.65 and Macquarie was easily the best of the banks, gaining 2.8 per cent to $188.12.

Commonwealth Bank sagged 0.1 per cent to $106.56, Westpac and NAB each rose 0.5 per cent to $24.22 and $31.85 respectively and ANZ was up 0.4 per cent to $35.77.

Originally published as Markets wrap: Tech shares rally hard to help ASX to three-week high