Australian sharemarket ends week on a high as Trump uncertainty swirls

The Australian sharemarket has ended the week higher, climbing 0.3 per cent on Friday as investors reacted to a high-stakes US court battle over Donald Trump’s sweeping tariff agenda.

The S&P/ASX 200 rose 24.9 points, or 0.3 per cent, to close at 8434.70, recovering from a slump earlier in the day, helped by gains from utilities, the big banks and consumer staples.

The choppy session followed a US federal appeals court decision overnight, allowing Trump to continue collecting tariffs under an emergency powers law.

The US government is pursuing an appeal against an earlier ruling on Thursday AEST that found the president had overstepped his legal authority in imposing sweeping tariffs.

Wall Street’s early rally faded by mid-afternoon.Credit: AP

The lifters

The big four banks rallied, with the Commonwealth Bank up 0.9 per cent, National Australia Bank gaining 1.3 per cent, Westpac jumping 2.7 per cent in a late surge, and ANZ up 0.4 per cent.

Major landlords to Healthscope, which collapsed into receivership this week, reached a deal to defer rent payments for 11 of the company’s private hospitals. ASX-listed HealthCo Healthcare & Wellness REIT (HCW) said it and the Unlisted Healthcare Fund (UHF) had reached a short-term deal with Healthscope and its receivers on Friday.

They said the agreement, which will result in the landlords ultimately being paid in full for rent until August, will support “the continuity of essential services” at each of the 11 private hospitals owned by the landlords. The deal will also result in outstanding rent for March and April being paid in full. HCW shares jumped 7.9 per cent.

Coles helped lift consumer stocks with a 0.3 per cent gain, while rival Woolworths rose 0.7 per cent.

The laggards

The energy sector slumped 1.4 per cent after oil prices slid overnight. Viva Energy fell 0.5 per cent lower. On Thursday, it was announced that Victoria’s first gas-import terminal in Corio Bay had won conditional approval from the Allan government as it sought to prevent damaging winter shortages in the state. Premier Jacinta Allan said her government was paving the way for Viva Energy’s proposed liquified natural gas import terminal to get off the ground.

Woodside Energy fell 2.1 per cent following a pair of positive sessions after the Albanese government gave parliamentary approval for the company to keep its controversial West Australian project, the North West Shelf, running until 2070.

The big miners were mixed, with BHP up 0.3 per cent while Fortescue shed 1.9 per cent and Rio Tinto gave up 0.6 per cent.

The lowdown

The gains on the ASX came after global markets were this week encouraged by Trump backing down on earlier threats for 50 per cent tariffs on Europe, as well as Thursday’s surprise US court ruling against his planned tariffs.

However, AMP chief economist Shane Oliver said the economic risks flowing from Trump’s policies remained high – even though the ASX 200 is now only 1.4 per cent below its record high.

“While the rebound in share markets has continued and has been supported by good breadth and signs that economic conditions so far are holding up reasonably well, Trump policies pose an ongoing macroeconomic risk for shares,” Oliver said.

On Thursday night, the S&P 500 rose 0.4 per cent after giving up most of an earlier gain. The Dow Jones rose 0.3 per cent, and the Nasdaq composite added 0.4 per cent. Uncertainty dominated the session after yet another twist was added to Trump’s tariff fable.

Wall Street’s unsteady session marked a downshift after global stocks initially leapt nearly 2 per cent in Tokyo and Seoul, where markets had the first chance to react to the ruling late on Wednesday by the US Court of International Trade. It said the 1977 International Emergency Economic Powers Act that Trump cited for ordering massive increases in taxes on imports from around the world did not authorise the use of tariffs.

The ruling raised hopes in financial markets that a hamstrung Trump would not be able to drive the economy into a recession with his tariffs, which were threatening to grind down global trade and raise prices for consumers already sick of high inflation. Trump has said he wants to bring manufacturing jobs back to the United States, and warned that the process could cause some pain for US households.

A federal judge in Washington made the same finding in a separate case on Thursday, but a federal appeals court allowed Trump to continue collecting tariffs under an emergency powers law, for now, as his administration appeals an order striking down the bulk of his signature set of economic policies.

The S&P 500 has pulled within 4 per cent of its all-time high after dropping roughly 20 per cent below at one point last month.

On Wall Street, tech stocks led the way after Nvidia once again topped analysts’ expectations for profit and revenue in the latest quarter.

The chip company has grown into one of the US sharemarket’s largest and most influential stocks because of the frenzy around artificial-intelligence technology, and its 3.3 per cent rise was the strongest force by far lifting the S&P 500.

C3ai, an AI application software company, jumped 20.8 per cent after it reported stronger profit than analysts had expected for its latest quarter. It also said the US Air Force had increased the maximum possible value for its contract by $US350 million ($543 million) to $US450 million. The company’s revenue last quarter totalled $US108.7 million.

E.l.f. Beauty was another big winner and rose 23.7 per cent after the cosmetics company delivered a stronger profit for the latest quarter than analysts expected. It also said it had agreed to buy Hailey Bieber’s Rhode skincare brand in a $US1 billion deal. Rhode had $US212 million in net sales in the 12 months to the end of March.

Bieber, a model and the wife of singer Justin Bieber, will be Rhode’s chief creative officer and head of innovation and also a strategic adviser to the combined companies.

They helped offset a drop for Best Buy, which fell 7.3 per cent even though it reported a stronger profit than expected. Its revenue fell short of analysts’ forecasts.

Many companies have recently said the uncertainty caused by tariffs is making it too difficult to offer any financial forecasts for the coming year.

In the bond market, Treasury yields eased following some mixed reports on the economy. One said the US economy had probably shrunk by less in the first three months of the year than earlier estimated. Another said that slightly more US workers had applied for unemployment benefits last week than economists expected.

The moves for European stocks were much more muted. France’s CAC 40 fell 0.1 per cent, and Germany’s DAX swung from an early gain to a dip of 0.4 per cent.

with AP

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