More encouraging vaccine trial results boost oil price, ASX surges
Oil stocks played a big role lifting the ASX higher, buoyed by more encouraging vaccine news and keeping the local market near nine-month highs.
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The Australian sharemarket rose for a second straight day after more positive COVID-19 vaccine news boosted the oil price, sending energy stocks higher.
The benchmark S&P/ASX200 index steadily climbed higher to close 1.2 per cent stronger at 6644 while the All Ordinaries Index jumped the same amount to 6856.
Axi chief global market strategist Stephen Innes said the healthcare world should be ecstatic AstraZeneca and Oxford University indicated their vaccine was as much as 90 per cent effective in preventing COVID-19 infection.
Oil markets were rightly jumping for joy, given improved fuel demand was expected to follow any pandemic breakthrough.
“The AstraZeneca delivery is a big deal as most of the developed world will be able to immunise its most at-risk population to COVID by the (northern hemisphere) spring and likely the entire community by mid-year,” Mr Innes said.
CommSec analyst James Tao said the local market continued to make up losses incurred during the year as the health crisis savaged the economy, with Queensland opening up its border to all of NSW, adding to the positive mood.
No new cases in NSW and Victoria was also buoying sentiment, Mr Tao said.
“In the US as well, a little bit more of stability in that transfer of power process following the US elections,” he said.
“Trump is not standing in the way of this particular process but still not formally conceding that he’s lost.
“All of this has allowed the market to have some pretty broadbased gains.”
Among oil and gas stocks, Beach Energy leapt 8.16 per cent to $1.85, Woodside added 2.96 per cent to $22.64, Santos put on 3.92 per cent to $6.36, Origin appreciated 5.2 per cent to $5.05 and Oil Search was up 2.4 per cent to $3.80.
Travel stocks also benefited from the vaccine news, with Qantas up 3.9 per cent to $5.57, Webjet surged 4.66 per cent to $5.61 and Flight Centre firmed 3.04 per cent to $16.59.
ANZ advanced 3.1 per cent to $22.97, Commonwealth Bank lifted 1.96 per cent to $81.16, National Australia Bank rose 2.6 per cent to $23.33 and Westpac found 2.6 per cent to $20.45.
Rio Tinto firmed 2.2 per cent to $103.13, BHP was 3.37 per cent higher at $38.30 and Fortescue increased by 2.73 per cent to $18.09.
Gold stocks — the usual safe haven in tough economic times — were sold off. Northern Star fell 8.88 per cent to $12.72, Silver Lake Resources plunged 9.4 per cent to $1.68 and Saracen Mineral Holdings slumped 9.02 per cent to $4.74.
The Aussie dollar was buying 73.20 US cents, 54.87 British pence and 61.74 Euro cents in afternoon trade.
Originally published as More encouraging vaccine trial results boost oil price, ASX surges
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