Benchmark S&P/ASX200 index smashes through 7400 for first time, pulls back after China move hits local miners

The benchmark index of the ASX pierced a level never reached before then pulled back after China’s latest trade move hit local mining stocks.

The Australian sharemarket climbed to heights never seen before then pulled back after China’s latest bid to suppress soaring commodities prices hit local mining stocks.

The benchmark S&P/ASX200 index smashed through 7400 points for the first time in morning trade before closing barely changed - just 6.7 points firmer at 7386.2 - while the All Ordinaries Index inched 0.4 points higher to 7633.4.

CommSec analyst James Tao said it was strong start despite a negative lead from Wall Street.

Already jittery US investors mulled data showing stronger inflation and weaker retail sales in May as they awaited the results of the Federal Reserve’s latest policy meeting, Ord Minnett said.

“They’ll be wrapping up their two-day meeting early on Thursday morning local time so certainly we’ll get a bit more understanding of how the central bank in the US feels about the economy and inflation, more importantly,” Mr Tao said.

On the ASX, energy stocks led gains followed by financials, healthcare and consumer staples, offsetting losses for miners.

Woodside Petroleum put on 2.28 per cent to $24.27, Oil Search advanced 1.46 per cent to $4.18, Santos gained 1.04 per cent to $7.76 and Beach Energy rose 1.11 per cent to $1.37.

Commonwealth Bank appreciated 1.32 per cent to $104.82 - yet another fresh all-time high after a string of recent record closes.

Commonwealth Bank shares have been breaking records on an almost daily basis of late. Picture: NCA NewsWire/Bianca De Marchi

“It’s on a tear at the moment and is doing a great job providing support to the whole market. It looks very bullish technically,” OMG chief executive Ivan Tchourilov said.

ANZ added 0.91 per cent to $28.92, National Australia Bank improved 0.71 per cent to $26.86 and Westpac was steady at $26.55.

Regenerative medicine developer Avita Medical, which was founded by renowned burns expert Professor Fiona Wood, surged 12.38 per cent to $5.63 after announcing an upgrade to its fourth quarter revenue guidance.

“As people begin to return to normal activities after the confines of the COVID-19 pandemic, we have seen an increase in burn accidents requiring treatment with the RECELL System in burn centers across the country,” chief executive Mike Perry said.

Another strong performers in the health sector was Telix Pharmaceuticals, which jumped 6.04 per cent to $5.62, while biotech giant CSL lifted 0.39 per cent to $302.90.

CommSec senior economist Ryan Felsman said it was a positive sign for retailers the weekly ANZ-Roy Morgan consumer confidence rating rose by 0.3 per cent to 111, compared to the long-run average since 1990 of 112.6, while consumer views on whether it was a ‘good time to buy a major household item’ jumped by 3.3 per cent.

“The outlook for consumer spending remains positive, supported by rock bottom borrowing costs, elevated consumer confidence, excess household savings, solid job growth and rising asset prices,” Mr Felsman said.

Coles put on 0.35 per cent to $17.05 and Woolworths strengthened 0.46 per cent to $43.70.

Consumer confidence is rising, according to a weekly ANZ-Roy Morgan rating. Picture: NCA NewsWire/David Crosling

Mining stocks fells after Bloomberg reported China’s latest move to quell raw materials price surges by ordering state enterprises to limit their exposure to overseas commodities markets and pledging to release the nation’s reserves of base metals.

Rio Tinto dipped 0.6 per cent to $125.71, BHP dropped 1.73 per cent to $48.37 and Fortescue shed 1.63 per cent to $22.95.

Myanmar Metals announced it had received a $66.5m non-binding takeover offer of 3.5 cents per share from Shenzhen Stock Exchange-listed miner Yintai Gold.

The company’s shares last traded at seven cents in February, when it was suspended from trade after the Myanmar military staged a coup against the democratically elected, Aung San Suu Kyi-led government.

“It should be noted that site-based due diligence enquiries may present a logistical challenge at this time due to the political situation in Myanmar and restrictions on travel due to the COVID-19 pandemic,” the explorer said.

Gold producer Gascoyne Resources announced it would take over neighbouring explorer Firefly Resources for 0.34 of its shares for each Firefly share, representing an implied offer price of 14.5 cents per share.

Gascoyne shares slipped 2.7 per cent to 36 cents while Firefly shares soared 20 per cent to 12 cents.

The Aussie dollar was fetching 77.02 US cents, 54.52 British pence and 63.45 Euro cents in afternoon trade.