ASX ends session higher following US gains made after election outcome

The Australian sharemarket has ended the day stronger, riding the Democratic win in the Georgia election runoffs.

Australian shares made strong gains on Thursday, riding the blue wave felt on Wall Street following wins by Democrats in the Senate election runoffs in the US state of Georgia.

The benchmark S&P/ASX 200 index rose 104.9 points, or 1.6 per cent to 6712, as investors and financial markets shook off the jitters being fuelled by the runoffs.

The broader All Ordinaries index jumped 99.1 points, or 1.4 per cent to a closing position of 6980.5, while the Australian dollar at the end of the local session was buying 77.9 US cents. Gold was fetching $US1914.81 an ounce.

CommSec analyst Steven Daghlian said investors embraced the prospect of near-term fiscal stimulus under the Biden administration, but flagged the performance of the Australian market has been mixed for more than the past month.

Market performance has improved following a Democrat win in the senate runoffs in the US state of Georgia. Photo by Jim WATSON / AFP

“Really over the last six weeks, the market hasn’t been able to take things to the next level. It’s been largely heading sideways since the start of December,” Mr Daghlian said.

“Mining stocks and financials are by far the biggest contributors to the [Thursday] improvements, and to a lesser extent energy stocks.”

Ongoing improvements in the price of iron ore of more than 40 per cent in the past two months prompted major miner Rio Tinto to reach record highs, closing the session with the highest daily gain of an 8.6 per cent increase to $125.66 per share.

Its major competitor BHP also benefited from the uplift, adding 6.1 per cent to its share price to close the session at $46.90 per share.

Technology stocks were the worst performing sector of the day, with accounting software company Xero incurring the largest share price fall, slumping 5.1 per cent to $140.22 each.

Buy now, pay later giant Afterpay also felt the effects of the tech slide, tumbling 4.2 per cent to $108.85 per share.

Mining giant Rio Tinto had the largest daily gain on the ASX. Picture: supplied.

Energy company IGO made strong gains, rising 7.4 per cent to $7.57 per share, while stock in Oil Search continued to benefit from the recent rise in global oil prices, surging 6.9 per cent to $4.16 per share.

Major banks all ended in positive territory. Commonwealth Bank’s share price rose 2 per cent to $84.58 each, while Westpac lifted 3.2 per cent to 19.99 per share.

ANZ stock increased 3.8 per cent to $23.64 per share and NAB rose 2.8 per cent to $23.04 per share.

Stock in Qantas jumped 2.1 per cent to $4.91 per share, coinciding with the positive news of no new locally acquired COVID-19 cases in NSW or Victoria, and the federal government confirming the vaccine rollout will commence by mid-February.

Telstra shares were unchanged at $3.01 per share, while large property fund manager Charter Hall incurred a 5 per cent slump to $14 a share.

Woolworths rose 1.4 per cent to $40.20 per share and shares in Wesfarmers increased 0.9 per cent to $50.95 each.