Positive finish for Australian share market despite bank weakness

The Australian share market closed higher after strong gains among health stocks but banks were a drag, especially Westpac.

The Australian share market finished in positive territory despite weakness among the big four banks, particularly Westpac, which scrapped its interim dividend citing ongoing uncertainty due to the coronavirus pandemic.

The S&P/ASX200 closed 0.77 per cent higher at 6123.4 while the All Ordinaries Index rose 0.81 per cent to 6268.7.

Healthcare was a standout performer with CSL, which reports its full year earnings tomorrow, jumping 4.36 per cent to $293.29.

Cochlear jumped almost 10 per cent to $217.74 despite booking a $283.3 million annual net loss due to patent infringement expenses in the US and the pandemic curtailing elective surgery.

Ord Minnett said it expected investors would focus on Cochlear’s recovery pathway, with revenues bouncing back to 85 per cent of 2018-19 levels in June and July, supported by catch-up surgeries and market share gains.

Engineering group Monadelphous soared almost 19 per cent to $10.05 after reporting its maintenance and industrial services division achieved its third consecutive annual revenue performance of more than $1 billion on the back of higher work in the resources sector, including shutdowns.

Westpac was sold off even through its third quarter earnings increased, dropping 2.33 per cent to $17.18.

Commonwealth Bank was 0.4 per cent lower at $70.48, National Australia Bank eased 0.79 per cent to $17.61 and ANZ was 1.04 per cent lower at $18.07.

Treasury Wine Estates plunged 14.2 per cent to $10.58 after reports China had launched an anti-dumping investigation into Australian wine exports.

China is probing whether Australian wine producers ‘dumped’ product at low prices to scupper local producers.

BHP dipped 0.53 per cent to $39.65 after volatile commodity prices dented the mining giant’s full-year profits, but its iron ore operations bolstered its bottom line.

However, the company says elevated iron ore prices will not last as supply from Brazil recovers after the Brumadinho tailings dam tragedy, while demand from China will be lower in the second half as crude steel production plateaus.

Fortescue rose 1.34 per cent to $18.19 while Rio Tinto gained 1.1 per cent to $101.99.

Coles reported a lift in its retail profits for the 2020 financial year as shelf-stripping panic buying during the coronavirus lockdown caused a surge in sales, but its shares fell 1.16 per cent to $18.71.

The Aussie dollar bought 72.28 US cents, 54.92 British pence and 60.74 Euro cents in afternoon trade.